Using fintech to promote social change

By David Beach | 31 October 2017

bobsguide spoke to Pennies CEO Alison Hutchinson about the potential collaboration with fintech players can have on facilitating and enabling new channels for donations to charities. Pennies, the Digital Charity Box, won the 2017 Emerging Payment Award for Best CSR or Charity Initiative.


How did Pennies come to be?

As CEO, I run the team and was here from the very beginning when we started around the kitchen table. Whilst there’d been a few people who had looked at the concept of donating by card, we went right back to the fundamentals of charitable donations. To this day, the UK’s preferred way of giving is to drop coins into a charity box because it’s easy, people only do it if they want to and it makes them feel good. Furthermore, from a retailer’s perspective it gives them a way of showing their customers which charities they care about as part of their broader approach.

With the advent of technology, we’re heading towards a cashless society. In fact, three in ten people now leave the house without any cash at all. Our key challenge was how to digitise the UK’s most loved way of giving, and that’s why the digital charity box concept was born.

What technology is Pennies using to digitise the high-street charity box?

First and foremost, we’re an independent organisation and that means we can embrace all technology and payment providers, so we can support all retailers across all channels. In this way, as a B2B organisation, we can enable consumers to give in the way that’s most convenient for them.

Our goal is to make Pennies a standard feature across a broad range of technologies. We know that consumers want the same convenient experience wherever they go, and we know that retailers may want to change charity partners but not go through a lengthy implementation procedure each time. We’re working with organisations across the payments and technology sectors to embed the Pennies donation capability across payment systems; in point of sale and ecommerce platforms. In this way, we’re developing a set of assets and tools that enables Pennies to become a standard feature across most technologies and platforms.

How easy is the bolt-on integration for any potential retail or technology partner?

Our priority is to make it easy for retailers to enable Pennies. That is why we work with a broad range of technology partners. Our journey started seven years ago, when we ran three trials with different technology providers; the success of the trials exceeded all expectations. Fast forward seven years and as our learning has developed it’s become even easier for everyone to get involved. We now have, for example, open APIs that enable you to do a couple of short agile cycles to build Pennies into your ecommerce platform. We’ve also got integrations with 40 different technology partners where Pennies is a standard “value add” feature.

We’d love to work with the emerging players who are providing an aggregation layer for organisations by providing technology and payment capabilities. We find that when we work with those players it’s both easy for them to build the technology and they then have a brilliant, unique, value added service. As we surpass 45 million donations to date, there are more and more retailers asking for Pennies; on the back of this, we’d like to help those emerging technology providers get on the front foot.

Which retailers currently use the Pennies’ feature?

We have over 50 different retailers now live with Pennies across different retail channels. Some of our retailers, like Fuller’s Brewery, are just in the process of rolling out our technology in close partnership with their providers, Zonal & Mastercard, who offer a real Pennies-capable payment solution. This collaboration also provides a platform to integrate with further pub and hospitality chains that are interested. Similarly, demand for Pennies from petrol forecourt retailers Rontec helped us build a solution for the forecourt sector. Rontec were enthusiastic to be the first to use Pennies in their sector and we worked with their payments providers HTEC who specialise in providing technology for forecourts. That has enabled us to roll out with another forecourt retailer, MRH, and by the end of the year we’ll be in 750 roadside retail sites.

Those are two examples from different sectors where the Pennies capability is in demand and it has driven technology providers to work with us. That’s why we’re particularly keen to invite emerging technology providers to keep us future-proofed going into 2018 and beyond and to give them a great “value add” offering for their customers.

Talk us through the Pennies experience from a consumer perspective.

If you’re in a Fuller’s pub or one of our hospitality retailers, like Zizzi, when the card terminal is passed to the customer to settle the bill, they are given the on-screen option to round-up to the nearest pound or to give, say, an extra 25p for charity (depending on how Pennies has been configured for that retailer). If you want to donate you press “yes”, if you don’t want to give this time you press “no”, and if you do nothing, the “ask” will disappear and you’ll proceed to the payment screen. That’s what’s lovely about Pennies – it’s always an opt in and reflects the initial founding fundamental that people like the feeling of dropping pennies into a bucket.

The experience is the same across high-street retailers, and online and in-app the consumer can choose to give by pressing the “Donate” button. On our various platforms – mobile, Xbox apps, ecommerce and in stores – the consumer sees the charity and donates with one click if they so choose; exactly like a traditional charity collection box.  

I also think the British public are increasingly frustrated by the number of times they’re approached to give at home, on the phone or on the street. Overall, the British public are very generous, but charities need to respect consumers personal space in both the digital and the physical world. ‘Text giving’ is a great example. It gathers lots of funds, but it was then reported that many charities took it one step further and began “hounding” people with follow-up texts. It’s a great donation channel but caution is required. Suddenly in this new open world of APIs, GDPR and PSD2 there’s a fantastic opportunity for fintechs to re-evaluate how to approach consumers and provide the technology to enable a better service. For all the good work charities do, they must continue to be respectful of people’s space.

In a digital world, people’s space is different and it’s an environment for fintechs to build systems where the consumers pull what they want towards them, rather than have it pushed on them. Pennies takes that seriously; we don’t hold customer data so there’s no follow-up. It’s completely anonymous and the donor has control of their charity giving.

Interestingly, the demographics of the online world have less of an impact on giving than offline. For instance, research suggests middle-aged men tend not to give as generously as women of the same age, but our work with Screwfix – who have a predominantly male market – found donations to Pennies to be gender indiscriminate. We also ran a test where people could choose to opt-in to paying 9p or a small amount and donations ran into the £1000s overnight. That was all to do with consumers having the choice and the ease to be able to donate.

It’s refreshing to see an innovator in the charity space.

One of the things that people forget is that Pennies is a charity too. We’re here to serve the whole charity sector, to help avoid a situation where every single charity and retailer has to do individual tech development themselves, which would mean more money is taken away from the important frontline work those charities do to transform lives and communities across the UK.

We drive effectiveness in the charity sector. The donation split of 90:10 helps us achieve this – 90% of donations go to our retailers’ nominated charities, and the other 10% goes to Pennies to help drive our “innovation machine” and maximise the overall impact for charities.  The 10% of donations going to Pennies is integral to improving our own output – we don’t charge the retailer, we don’t charge the charity – so we’ve developed Pennies to be as effective and efficient as possible in support of the sector.

How does Pennies intend on keeping up with new trends?

Part of the way we keep up with new technology is through external partners to supplement our 12 employees. We’ve set up an advisory committee, which is chaired by one of our trustees, Peter Ayliffe, who formerly ran Visa Europe, as well as representatives from mobile wallets, large payment acquirers and technology companies. This committee helps us tap into the expertise of what’s happening in the next generation, and we put that volunteering to real and good use in a way that gives back to more charities.

On the back of this, we were recently able to make two major announcements due to reinvesting. The first was our first contactless solution which was launched in The Entertainer top shops in July this year.  The toy shop chain was actually the first retailer to take Pennies in store back in 2011, and the reaction was fantastic – they found that 50% of their customers voluntarily chose to donate.  That success was one of the reasons The Entertainer was keen to enable contactless donations via Pennies too, which was made possible through collaboration with their payment partner, Worldpay Total. Following implementation of the contactless solution in July we found donations doubled.

In order to stay ahead of the game, we’re looking to roll out more contactless solutions. We’ve also just launched our capability with Fulham Football Club who were our first retailer to truly offer an omnichannel solution from launch across all retailing and payment channels through their technology partner, Optomany. 

The other announcement was that we are now an approved partner for Apple, where Pennies can feature in native iOS apps alongside Apple Pay. Following on from that we had Domino’s Pizza, who had provided Pennies across Xbox, Android and their website, open up their channels and add Pennies to their iOS apps too.  Since then they have recorded significantly higher donations – they are raising around £10,000 in a week all from a few digital pennies here and there.

If we all donated an average of 30p a month, we’d raise £175 million for charity from a new source of digital donations.

So Pennies is inviting and challenging technology providers to improve the capability of their digital charity box?

Absolutely, this all points to our philosophy of collaborating and using the great talent within the fintech community to put technology to solving real social problems.

We invite technology providers to work with us and make a huge difference. If we turned all the digital pennies donated last month via the digital charity box into physical pennies and stacked them face to face they would be the length of a marathon. We invite partners to join with us and accelerate the time it takes us to raise a “marathon of pennies” – from a month to a record-breaking time of less than 2 hours, 2 minutes and 57 seconds.