With a burgeoning middle class population who often empty their savings on education or medical expenses, other financing options have become a natural go-to. A large number of 20 somethings are already paying EMIs for loans taken for personal causes or to buy a home or to fund their education. Many are opting for insurances to cover any or all medical emergencies. Crowdfunding in India has emerged as another option to finance personal and medical needs with the help of close friends and kind strangers. The awareness for crowdfunding as means of financing a problem is very low. Many have doubts over it actually working and others think it’s not for them.
That’s the biggest misconception. While not everyone may be eligible for loans and insurances, crowdfunding is indeed for everyone and anyone. Here are 7 cases in which crowdfunding in India is more effective than other sources of finance:
- To deal with emergencies: The best part about crowdfunding, with a good network you can raise funds overnight! Take a young Dheeraj’s example who raised money for his father’s surgery in one day! Crowdfunding can be a great way to seek immediate financial help from across the world to deal with medical or personal emergencies.
- To deal with a sudden death: In most cases when the bread earner passes away, the family has to not only deal with the trauma of the death but also deal with the expenses that follow. For most who aren’t insured it is impossible and friends and family have to step in to help, for others who have a life insurance the claiming process is exhaustive. Crowdfunding and collecting a fund to help family members of a deceased friend or colleague can be more effective. Mark’s friends got together to raise Rs. 3.6 lakhs for his family.
- To deal with a long-term disease: When medical problems come with a recurring cost, it becomes an issue to not let the bills pile on. Those who go through continuous chemotherapy for cancer or have to pay for dialysis or prenatal care have weekly or monthly costs. Sometimes the treatment is carried out indefinitely and thus estimating a final cost becomes difficult. Crowdfunding in India can help you run your fundraiser for months and thus it becomes easier to keep the treatment going over a long period of time.
- To deal with disasters: Much like medical emergencies, disasters come unannounced and crowdfunding can be a great way to mobilize resources from various parts to help relief effort by individuals or an on-ground NGO. Here’s how crowdfunding helped during the Chennai floods.
- To help someone in need: Crowdfunding can help you raise money to help a friend or a colleague going through an emergency or a stranger who may need help. E.g. you could quickly crowdfund to help your maid pay for her children’s education.
Crowdfunding can slowly replace loans as an effective financing option in many situations.