Effective fundraising strengthens the association’s financial standing and reduces its dependence on external funding. In addition, often external funding comes with a co-financing requirement, i.e. the association itself must finance a part of the activities. Developing an association’s fundraising can take a significant amount of time, but it can help guarantee the continuity of the association’s operations. Fundraising can also serve as way to engage with the association’s members – doing things together is fun! Grants and financial assistance for associations will not be increasing in the coming years and therefore associations’ own fundraising is becoming more and more crucial.
The many ways to raise funds
Donors and fundraising campaigns: An association can accept monetary donations from individuals wishing to support its cause if the association’s rules allow it. If the association does not appeal for or request donations, it does not need a money collection permit issued by the police. However, if the association does ask for donations for example in its communications or at events, or if it organises a fundraising campaign, this is considered money collection. Money collection is subject to the Money Collection Act and usually requires a money collection permit issued by the police (opens in new tab). However, associations can organise a so-called small-scale money collection even without the permit. In order to apply for a money collection permit, an association must be registered with the Finnish Registry of Associations.
Small-scale money collection: Since March 2020 associations in Finland have had the opportunity to organise small-scale money collections without needing a money collection permit. An association also does not need to be registered with the Register of Associations in order to organise a small-scale money collection. Each such collection may run for a maximum of 3 consecutive months and can raise money up to EUR 10 000. An association can organise two small-scale money collections per calendar year. A written notification regarding the collection must be submitted to the police beforehand. Read more on the small-scale money collection on the poliisi.fi website (opens in new tab).
Membership fees: An association whose work is important to many people can easily amass hundreds of members. In such a case, membership fees are an excellent way to generate income for the association. The calculation base of membership fees must be set out in the association’s rules.
Supporting membership: Offering people the option to join the association as a supporting member can be very beneficial from a fundraising point of view. A supporting member is a member of the association, who chooses to pay a higher-than-regular membership fee because they wish to make an extra contribution to the association’s activities. An association is only allowed to offer supporting membership if the association’s rules include sufficient details about such membership. If the rules do not include the required information, and if supporting membership does not come with any membership benefits, offering this option is not considered true member acquisition but rather donor acquisition. In this case, the association must speak of donating instead of supporting membership and it must have a money collection permit.
Pop-up restaurants: An association may organise up to 12 pop-up restaurants a year without it being considered a business venture. A pop-up restaurant can be organised independently or as part of a larger event, such as the restaurant day. Find more information on how the Finnish Food Act regulates pop-up restaurants on Finnish Food Authority’s website (opens in new tab).
Product sales: Traditional sales activities for associations are, for example, jumble sales and charity shops. Whichever sales activity the association chooses to engage in, they should carefully consider what types of products it is profitable to sell. For example, people may not want to buy products which prominently feature the association’s name or logo unless they’re very familiar with the organisation and its activities. If an association sells goods, it must learn about sales taxation. Also be aware that business income and other fundraising income must be recorded separately in the association’s accounting.
Corporate partnerships: Corporations can support associations through donations or they can offer benefits such as discounts to association members. Corporate partnership can also involve something else entirely. The company and the association can for example design a product together and split the sales proceeds. At its best, a corporate partnership can promote the association’s goals, improve its financial standing and boost its visibility.
Service sales: Parties such as municipalities, businesses, TE offices, and other associations can purchase services provided by associations. The most common services offered by associations include interpretation services, integration-promoting activities and employment-promoting activities.