Indian philanthropy is entering a new era of giving: 4 emerging trends

Indian philanthropy is on the cusp of a new era marked by an evolving philanthropic landscape and the rise of family philanthropy. Despite India’s robust economic growth and aspirations to become a $5 trillion economy by FY 25, multidimensional inequalities persist, which necessitates a strengthened philanthropic infrastructure.

Family philanthropy holds immense potential that, once harnessed, can be transformative for India’s development, but often remains overshadowed by corporate social responsibility (CSR) initiatives. India Philanthropy Report 2023, published by Dasra and Bain & Company, highlights that family philanthropy in India is expected to grow at ~18 percent CAGR from FY22 to FY27. The report also suggests that India’s social sector spending has increased in FY 22, with the public sector carrying the weight, accounting for 95% of total spending. However, with an expanding budget deficit, higher debt burden, and increased crude oil prices, public finances are likely to be limited in the future. Therefore, family philanthropy must step up and play a catalytic role in bridging the funding gap in India.

To achieve the vision of long-term sustainable and inclusive growth as we progress towards India@100, it is imperative for the philanthropic ecosystem, public sector, private sector, and social sector to collaborate effectively in building community resilience. Therefore, it is essential to understand the following four emerging trends in family philanthropy to support this cohort better:

Next generation is reimagining philanthropy: Within family philanthropy (UHNIs, HNIs, and affluent givers), two cohorts are emerging as harbingers in reshaping giving, disrupting sector barriers. Now-Gen givers, who are professionals and entrepreneurs with first- generation wealth, and Inter-Generational givers, which includes the current generation of traditional family philanthropists, are reimagining giving by looking beyond historical funding preferences and beginning to focus GEDI (Gender, Equity, Diversity, and Inclusion), climate action, and strengthening the philanthropic infrastructure. Embracing a systems-thinking and field-building approach, they have bolder aspirations of building a resilient India through leveraging technology, taking collaborative action, and a greater emphasis on equity and inclusion in their giving.

Funders are looking to invest in philanthropy ecosystems through innovation, research, and institution building: Philanthropic infrastructure is the common denominator across funder segments. When strengthened, it can unlock greater funding for the social sector at large. Funders are recognizing that a robust philanthropic infrastructure can enable better outcomes towards achieving development priorities. There is a large shift in aspirations towards investing in ecosystem strengthening by both Inter-Gen and Now-Gen cohorts (41%).

Arts, Culture and Heritage are increasingly garnering funding attention: UHNI interest in arts, culture, and heritage is on the rise, reflected by the significant increase in fund allocation from 3% in FY 20 to 15% in FY 22. Moreover, almost one in five (19%) Inter-Gen donors are giving to emerging areas such as arts, culture, and heritage as well as sports.

HNIs and affluent givers have untapped philanthropic potential: HNIs and affluent givers are an emerging segment with high growth potential and a strong desire to give. Their combined contribution increased by 11% over FY 21 to INR 25,300 crore, driven by a 12% increase in the affluent population and a 7% increase in the HNI population. The affluent population is expected to play an important role in giving in the future, too, with its population predicted to rise to 15.5 lakh individuals by FY 27 from the current 8.7 lakh individuals.

Building trust and unlocking their giving potential will require user-friendly technology platforms and access to reliable NGO data.

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