Funding from family philanthropy in India has tripled its corpus in fiscal year (FY) 2020, even as all other sources remained stagnant in the country in the past year.

Growing to approximately Rs 12,000 crore, it saw an approximate two-third increase in funding since FY 2019, the India Philanthropy Report 2021, co-created by Bain & Company and Dasra revealed.

The 11th annual report, which shares a comprehensive perspective on the growing philanthropic space in India, noted that in FY 2020, private-sector funding totalled about Rs 64,000 crore, recording an almost 23 percent rise from in FY 2019.

The report explained that private- sector funding -- stemming from four sources including foreign, corporate, retail, and high-net-worth individuals (HNIs) or families -- and primarily ruled by foreign contributions. These contributions account for a quarter of all funding. While domestic corporation donations also known as Corporate Social Responsibility (CSR) account for 28 percent and retail investors account for another 28 percent. The remaining contribution-- at a whopping 20 percent -- comes from family philanthropy. Family philanthropy is “the biggest source of growth, accounting for almost two-thirds of the increase in funding since FY 2019,” the report said.

Education and health dominate

Despite the economic setback that the pandemic caused to the country and the world in the past year, family philanthropy has proved to be resilient and has showered the potential to grow, the report observed.

“It is indeed heartening to see that something that is too integral to Indian culture — “giving” to those who need it is coming of age. 2020 has been a year of hard truths. This is a wake-up call to reimagine our approach towards strategic and collaborative philanthropy and the impact it can have. The case for family philanthropy is clear and so is its transformational potential,” said, Dinkar Ayilavarapu, partner, Bain & Company.

Seconding this, Neera Nundy, co-founder of Dasra, a strategic philanthropic organization, said that family philanthropy can collectively shape India's development agenda. “Nurturing the nascent family giving ecosystem with enhanced support can be transformational for India,” Nundy added.

The report noted that while family philanthropy can unlock an investible corpus that can nearly double the entire philanthropic space in India, it is not entirely free of biases.

For instance, education and health-related funds continued to “dwarf other causes”, receiving a higher share of family giving at 47 per cent and 27 per cent, respectively. Meanwhile, technology which accounts for about 9 percent of family net worth, eats up 26 percent of all family philanthropic giving.

The report also points to an expansion in the depth of India’s wealth, with a rise in the number of Indian ultra-high-net-worth families. “If these families start giving in line with their global peers (2 percent to 3 percent of their wealth), family philanthropy could generate an additional annual investible corpus of Rs 60,000 to 100,000 crores for the nonprofit sector,” the report stated.

First Published:Mar 15, 2021 4:13 PM IST