Alternative Sources of Financing

By Eric Johnson, World Bank Institute (WBI); Sherine Ghoneim, Economic Research Foundation (ERF); Margaret Nyrambura Ndung'u, EcoNews Africa; Sangeeta Gupta, Tata Energy Research Institute (TERI)
May 2001

Once the Web site is established, a number of financing venues may be considered. These alternatives are typically viable in the commercial world but may be adapted to cater for CSO requirements. It should be acknowledged that the proposed alternative financing venues are put forward for consideration in the long run as their implementation to date has proved both challenging and difficult to sustain mainly due to institutional rather than technical constraints.

Consulting Services

CSOs may build on their experience and offer some technical consultancy or training services to similar CSOs in process of developing their Web presence. In fact this modality has been particularly successful in developing regions as similar issues pertaining to non-for-profit orientation, independence and role in society has led to successful partnership and knowledge sharing, that could not be established with commercial firms. Offering such consulting services may be an avenue for generating modest income on a regular basis to sustain the Web operation and maintenance.

Sharing technical resources may also be considered as a tool for generating revenue. This may be considered in the cases where CSOs have a well-established technical infrastructure and have the capacity to share resources either with regards to technical set-up (for example, hosting) or subcontracting human resources (for example development expertise). As in the case of consulting services, it is often a viable solution to create some limited finance to sustain Web operations.

This philosophy was underlined in the development of the Global Development Gateway, a World Bank project, which built on expanding and sharing its resource base expertise. Similarly, a number of UNDP projects such as SDNP, have benefited from sharing the existing technical infrastructure, human resource expertise and knowledge base available at the UNDP.

Subscriptions

This may be considered in different forms:

• Either in the form of a corporate membership (or sponsorship) at large which allows access to CSO services and publications and which indirectly finances the Web maintenance and updates. This is sometimes financed through sponsorship from the business community.
• In the form of a publications subscription that would again cover the cost of print and online access to the institutional Web site.
• By making particular Web services, such as expert databases, online publications and journals or library services restricted access only against an annual subscription fee. In practice this is often the most difficult to implement as it is not in the spirit of a CSO making knowledge easily accessible to its community members.

Advertising

E-Commerce

Although the extent of e-commerce diffusion varies from one region to another, it is an emerging form of electronic trading that is appealing for its convenience. To date, not many CSOs have such a facility in place, yet it may be recommended in the long run as a means of generating revenue to the institution. Selling services and/or publications such as books, journals, etc., online does not have to be confined to the institutions own products and services, but may be extended to provide a "one stop shop" of products of interest. Providing such a service may be maintained on a monthly fee or on a transaction basis to secure generating income to the institution on a regular basis. It is worth mentioning here though, that instituting an e-commerce mechanism is typically governed by national laws and regulations that have to be taken into account. Moreover, it would entail putting in place resources and processes to ensure both the viability and sustainability of such a mechanism.

A number of organizations have set up an initial order taking system to get around the institutional and regulatory constraints with a view of building an e-commerce system in the future.

Finally, it is worth noting that CSOs are often involved in a number of collaborative projects with multilateral agencies and foundations. Through such partnerships, opportunities for seed monies to develop particular themes, institutions or regions may be made available. It is often recommended to maintain a dialogue of mutual interest to pursue opportunities for funding as they arise.