Can only the rich do social good? Not really

Some innovative organisations let you donate small amounts for social good and empower the recipients

Most middle-class folk would like to make an impact on the lives of people less fortunate than themselves. However, the fleeting thought to do good is normally brushed aside in the rush of day-to-day living. The main line of thinking is, the amount they can spare for this is so low that it will not make an impact, and only the rich can afford to spare money for social good.

Some people turn to their immediate circle of assistants like the maid, watchman, newspaper, milk delivery person etc, and help them on things such as their children's education expense, hospitalisation expense etc. Some people make this longer lasting by buying life and health insurance for them and their families. This does give a lot of satisfaction to the giver, as it has a visible impact on the lives of fellow human. A lot of people are hesitant to use this route because of the heavy turnover of these assistants. Also, some feel any amount given like this ceases to be a voluntary contribution and creates an expectation on the part of the recipient and effectively becomes some sort of additional compensation to them.

A combination of innovative social organisations and the internet has thrown up many alternate ways in which you can do social good without busting the bank. The best thing about these organisations is that they empower and dignify the recipients the material or funds not given as charity.

A great example would be Goonj (www.goonj.org), which carries out a large scale "cloth for work" programme in India. To quote from their website, "Communities have built huge bamboo bridges, dug up wells, have done bunding of acres of land, developed small irrigation canals, have built drainage systems, built village schools and have taken up massive exercises of repairing roads, developed water harvesting systems, and cleaned up water bodies. All these works are done not by paying people wages but by making them understand their own community power, using old material as a reward. Goonj is using material from the cities as an entry point into people's lives. This is a work where not only the old under-utilised material fills up the gaps of resources in development works, but is also dignifying the act of giving. Now, thousands of people don't get material as charity or donation, but earn it as reward in lieu of their work."

So, now if you wish to discard your old clothes just contribute these to Goonj and see them convert the small contributions into very significant social change on the ground.

Another example is Rangde (www.rangde.org). This is a not-for-profit company that allows you to earn interest on your surplus funds and creates visible social impact by allowing you to do social investing. You can lend money through Rangde to a number of borrowers vetted and identified by the field partners of Rangde. Your money is spread over a number of borrowers. The money is lent at interest rates of around 12 per cent and you get around four per cent (the same as savings bank interest) with the balance eight per cent being used to defray the working expenses. This enables borrowers to get money at a very reasonable rate of interest for use in livelihood earning (small shops, services, poultry etc) or education expenses, or even consumption. The repayment rate is 99 per cent plus with very few default. Defaulting is for the Mallyas of this world - the poor don't default on their obligations, as they have proven time and again. You can withdraw the money repaid, along with your share of interest, or you lend again to other borrowers. You can contribute as little as Rs 100 . So, if you have money sitting idle in your savings account, you can now put it to better use.

These are only two examples of innovative social organisations that are reaching out to the middle classes to combine their contributions and carry out social change on a large scale. I am sure there are many more such organisations and I would love to hear from you about them.

Disclosure: I have no connection with both the organisations except as a regular contributor.

The writer is a Sebi-registered investment advisor