Funding story - Asian Foundation for Philanthropy

The foundation has been a quiet success story, focusing on the UK Asian community's remittances.

At what point does private philanthropy become grant-making, as opposed to simply giving money to good causes? And at an earlier stage, at what point do remittances - money sent to families and communities 'back home' - become philanthropy?

"Philanthropy has become very fashionable in the western world, but diaspora communities have been giving for years," says Bala Thakrar, director of the Asian Foundation for Philanthropy (Third Sector 4 April 2007). "It was Department for International Development research that made us realise that remittances - especially from the Indian, Chinese and Ghanaian communities - amounted to more than overseas aid. We're now in a position to talk about our giving and have it recognised in a big way."

One of the catalysts for setting up AFP, which delivers a mix of individual giving, grant-making and volunteering, was the Asian community's response to the Gujarat earthquake in 2001. "The Disasters Emergency Committee raised £8m, and the Asian community raised £6m," says Thakrar. "Previously, our giving used to be very much individualistic and private, then everybody united." The foundation has built on this move to collective giving, providing a vehicle for people to give to small NGOs and grassroots organisations that deliver on a larger scale.

According to the most recent Index of Global Philanthropy from the Washington-based Hudson Institute Center for Global Prosperity, the combination of remittances and private philanthropy - foundations, donations and enterprises - in the US is now four and a half times official US aid. There isn't an equivalent figure for the UK, but the index calculates that global 'official development assistance' is a relatively minor player in the amount of money being given from richer to poorer countries.

Remittances alone cannot and will not solve poverty in the developing world, but in practice they make it possible for a lot of people to buy the food, education and care they need. Formalising them into a bigger grants scheme - tipping over into structured philanthropy - takes this an important step further.

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