You are scrolling the feed on your favourite social media platform and up comes the sob story of someone desperately in need of cash. Emotive pictures, videos containing fervent appeals, scanned images of supporting documents are provided. With emotions running high, the good samaritan in you joins the online donation campaign.

Such fundraisers are usually run to seek financial assistance required to buy expensive medicines, surgeries, fees to continue education, money to run animal shelters or to do social work, etc. Then, someone notices an anomaly and by the time you can act, you realise you have been scammed by a fake campaign. 

While the proliferation of online donation campaign platforms such as Ketto, Milaap, Impactguru and Donatekart has made it easier to raise money for genuine causes, it has also unwittingly opened the window for fraudsters and scam artists to collect funds by duping the gullible public. Here are key things to know before you turn emotional and contribute to online donation campaigns.

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Due diligence needs

Online donation campaign platforms leverage the power of crowdfunding, which provides a quick and easy way to raise money using the internet and social media. Typically, platforms claim one can start a fundraiser within a few minutes. While campaigners have to undergo a KYC verification and platform executives review the information submitted by the campaigner, there is no mechanism to verify that the facts presented in a campaign are 100 per cent genuine. Only if suspicion is raised regarding a fundraiser do platforms usually investigate. 

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There have been cases where excessive amounts have been requested for simple medical procedures. For instance, a campaign claimed congenital heart disorder treatment will cost ₹8 lakh but medical practitioners argued it will cost ₹3 lakh. In another case, a gall bladder-linked campaign managed to raise ₹33 lakh but gall bladder ailment related treatments hardly cost that much. Sometimes, multiple campaigns are run on various platforms by the same beneficiary. That apart, there are instances of supporting documents presented being forged or misused. Signed and stamped estimate letters from doctors/hospitals are not enough, if you feel something is off.

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So, before you donate to a campaign, you must verify that it is a genuine case. Call up the hospital, educational institute and see if the numbers match with the campaign figures. Ask professionals about whether the costs involved are indeed realistic. Do not blindly read everything written in the campaign page, because the interests of the online platform may be different, especially if it gets a ‘campaign success fee’ or ‘commission’. Some platforms may not charge anything for a fundraiser, but the onus is on you as a donor to check that the beneficiary of funds is not hoodwinking the public.

Tax benefit eligibility

Section 80G of the Income Tax Act allows deductions for contributions made to certain relief funds and charitable institutions. But, this does not mean all such donations made by you shall fetch tax benefits. Hence, it is extremely important to understand if your donation is eligible for tax deductions. 

Irrespective of the amount or the genuineness of the case, not all donations are eligible for a tax deduction. You can determine whether your donation is eligible for a tax deduction on the platform’s fundraiser page and in your confirmation email. So, if you donate to a fundraiser that isn’t eligible for tax deductions, you will not receive an 80G receipt. 

Do note that only donations made to fundraisers that are set up by legally registered non-profits (NGOs) or charities may be considered eligible for donors to claim as a tax deduction. Online donation platforms are only a custodian of funds, hence cannot provide tax exemption on their own. There may be a delay in getting tax benefit receipts. 

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