Reviewing your bank fees can help you save money

Charities must look at every way to save money in a tighter financial environment, says Peter Mitchell of CAF Bank

After months of build-up and hype, we are now halfway through the election campaign.

As politicians travel the land with the media in tow, discussions will undoubtedly turn to the savings the Government will have to make to reduce our nation's unsustainable levels of debt. The debate is not about the cuts themselves, but how and when to implement them.

This means we are facing the prospect of an administration that will be introducing cuts to spending budgets. With almost half of the charity sector's income coming, either directly or indirectly, from government, many charities are facing a difficult economic future over the next four to five years.

These tough circumstances won't be new to the sector. For the past 18 months there have been countless warnings from umbrella bodies, researchers and sector leaders on the impact of the recession on charities. The increase in demand that many charities are already experiencing, coupled with a drop in voluntary donations, is making times hard.

Charities have, by and large, weathered the storm fairly well, but they should not rest on their laurels.

There are obvious ways to reduce costs. Every charity should start by looking in detail at income and outgoings. Start by examining whether there are better contracts available for services such as cleaning or electricity, and reviewing whether you can contract out aspects of your administration, such as payroll and accountancy. These are all relatively simple things to look at, but have the potential to yield great savings for your organisation.

But there are also less obvious areas where charities can save money, such as banking. Most banks charge charities fees for their day-to-day banking, whether it be monthly account-management fees or the cost of processing cheques or organising other transfers of funds.

What charities do not always realise is that specialist charity banking providers are often significantly cheaper than the major high-street banks.

CAF Bank and other specialist providers such as Triodos Bank and Unity Trust Bank are focused on offering a better deal to charities than the major names.

I believe that even in the best of times, charities need to ensure they are being as efficient as possible.

Your charity's banking arrangements can form part of a package of efficiencies to ensure that your organisation is in as robust a position as possible to take on the difficult economic years ahead.

- More Finance & IT at: third

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