The Catholic international development charity Progressio might have to shut down unless it can secure £2m in funding, and has begun a consultation on how to handle the possible closure.
The London-based charity, which operates in countries in Asia, the Middle East, Africa and South America, said it had found it increasingly difficult to secure sustainable funding. Martin McEnery, the charity’s chair, said it had to be realistic about its future.
The charity, which works to relieve poverty by working with local partners in the developing world and running a volunteer service, employs 28 staff and had an income of £5.8m for the year ending 31 March 2015, with spending of £6.1m.
A consultation on the possibility of winding up the charity in the spring has begun with staff, funders, supporters and partner organisations. It is due to run until trustees hold a review meeting on 14 September.
In a question-and-answer section on the consultation, posted on the charity’s website, the charity said it might start the next financial year with less than £90,000 in secured grant income because many of its projects and associated funding were due to finish.
The charity’s volunteering abroad programme, the International Citizen Service, would receive funding, the charity said, but it would not be enough to cover the charity’s core costs.
In a statement, McEnery said: "The past five years have been increasingly challenging for Progressio and our projects overseas.
"We have continued to deliver good work through these challenges, but it has been difficult to secure the funding – particularly unrestricted income – necessary to ensure a sustainable future. This is in spite of the best efforts of our staff and a number of close supporters."
He said trustees "fervently hope" that during the three month-consultation the charity would be able to secure the £2m unrestricted funding it needed from April to survive.
He said: "The trustees are open to other opportunities arising, yet we must remain realistic and act responsibly.
"On that basis, the consultation on the possibility of closure next spring will allow us to make balanced and informed decisions in light of both the long and short-term interests of the charity, and in compliance with our legal duties. In the meantime, all our ongoing work continues."
The website Q&A section said the charity had been attempting to diversify and increase its funding for several years, but it was operating in "a very competitive, tough fundraising environment and many others are struggling too, especially small and medium-sized organisations".
It said the consultation would include detailed planning for all areas of Progressio’s work in the event of a decision to close.
All volunteers on ICS projects and those due to start in September 2016 would be unaffected by the consultation or any decisions taken as a result, it said.
A Charity Commission spokesman said the charity had notified the regulator of the consultation and it had no concerns.