Missing Millions

The impact of Revenue Leakage on UK Charities

Revenue leakage is a significant financial issue, and critically, it is something that charities and not-for-profits are just as susceptible to as their commercial counterparts. While the phenomenon is well known across industry, it is often hard to identify and understand where and how it is occurring operationally. At a time when the cost-of-living crisis continues to impact donations, it is more important than ever that charities aren't losing additional income because of poor processes, poor quality data, or human error. To gain a better understanding of the ways revenue leakage is impacting UK charities, we surveyed 50 senior decision makers who have responsibility for managing profit and loss about their experiences and views. The survey showed that revenue leakage is having a profound effect on both business operations and the donations that they should by all rights be receiving.

On average, the research esimates that UK charities are leaking 6.84% of revenue each year - equating to £5.97 billion annually. That is a huge amount of money leaked and lost each year but with often little dedicated resource or understanding of how to fix the issues, poor process and lack of controls and governance will continue to detrimentally impact the organisational performance and fundraising.

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