How crowdfunding platforms in India are using AI, blockchain to help people raise money for medical procedures
Puja Bhatnagar from Delhi had battled chronic liver disease for 17 years. In March 2017, it became evident that she needed a liver transplant when she stopped responding to her ongoing treatment. The hospital costs and medical bills were piling up, and her husband, Anurag, had to soon figure out options to raise money. This was when he started a fundraising campaign on ImpactGuru.
Within a span of just 40 days, Anurag was able to raise Rs 25 lakh through donations and contributions from nearly 400 people.
“Crowdfunding helped spread the word about her issue and we got a quick response. The contributions came in from 15 countries, and we got people’s attention through Facebook, Twitter, WhatsApp, and ads placed on different blogs. We had not expected to collect this high an amount in such a short span of time, but this was made possible by crowdfunding.”
Crowdfunding in India is at the nascent stage at present, having a market size of $50 million. Since 2010, there are at least 15 digital crowdfunding platforms in India, and the past year alone has seen 12,000 successful campaigns.
Varun Sheth, Founder of online crowdfunding platform Ketto, says,
“Crowdfunding in India has grown over the decade because more people have access to the internet, with the digital connectivity enabling them to make payments easily online. And the healthcare sector has witnessed the maximum impact.”
Image Credit: Milaap
Online good samaritans
Every year, India spends $100 billion on healthcare, 60 percent of which is on out-of-pocket expenses that are not reimbursed by the insurance companies. According to a FICCI-KPMG report, the healthcare sector has witnessed a 16.5 percent CAGR growth over the past decade, and it is expected to touch $280 billion by 2020. However, despite the growth, India’s public healthcare remains in shambles, with the government spending a mere 1.15 percent of its GDP on providing access to healthcare. And this access to funds for healthcare has become a life-or-death situation, literally, in many cases.
This is where crowdfunding platforms have stepped in and gained prominence. Through a simple click of a button, people are able to share their stories, and the difficulties and challenges they faced during emergencies with the hope to raise financial support through public contributions. Says Varun,
“With increasing social media presence, people are sharing information easily through WhatsApp, Facebook, Twitter, and Instagram. There is more transparency with the way funds are being utilised, and donors are updated about the cause for which they have donated. People inherently want to do good. These avenues have made it easier and more convenient for them to do so.”
Image Credit: Ketto
Given the high cost involved in medical care, many people resort to personal loans with steep interest rates and struggle to pay them back, spending sometimes years to close a loan. Since online crowdfunding comes without debts, it becomes an optimal solution for many patients.
Take Constable Deepak Patil, from Mumbai, for instance. He managed to raise over Rs 9.5 lakh through Ketto for his liver transplant surgery.
“Deepak’s liver had failed, and he needed a replacement at the earliest. Every day there was a new bill to account for – either for medicines, or the machines, or the hospital. We had nothing left but for the kindness of strangers,” his father recalls.
While the present level of awareness about crowdfunding among patients and medical professionals remains modest, it seems to be picking up gradually. Crowdfunding platforms work in tandem with hospitals to notify the patient about the option of raising funds through online crowdfunding. They also help them by verifying their medical records.
For those worried about where their funds go, crowdfunding platforms are doing their bit to alleviate their fears. Varun adds,
“To ensure that funds are solely utilised for medical care we transfer the raised funds directly to the hospital. Further, we have tied up with over 100 hospitals and medical centres across India to verify and cross-check the claims made by the campaigners and ensure that there is no misuse of donations."
Crowdfunding platforms often transfer the funds directly to the concerned hospital to prevent misuse of donations. Image Credit: Ketto
Using AI and blockchain for a cause
Crowdfunding platforms are today using artificial intelligence (AI) as a lever to not only create fundraiser campaigns but also to promote causes according to a donor’s past contributions.
Milaap, one of the earliest crowdfunding platforms in India, was launched in 2010. It now uses AI-driven chatbot technology to help campaigners create fundraising appeals. With the help of data analytics, the platform is able to understand the nature of the campaign and is able to start one within five minutes, as opposed to the previous 15 minutes.
ImpactGuru, on the other hand, uses an AI-based story-builder with a standardised template for fundraisers to design their own campaigns. Piyush Jain, founder of ImpactGuru says,
“One of the biggest problems people face is their inability to articulate their story properly. Through data analysis and an AI-based bot, we have created a platform that automatically and dynamically creates a compelling, emotional fundraising story for each patient by asking them a few objective questions. As a result, we have seen an increase in donations by 50 percent.”
Artificial Intelligence and machine learning are also used to prevent and detect fraud transactions - be it people who are trying to create fake campaigns or donors who use stolen credit cards to make payments just to test whether the credit cards are working. As a result, ImpactGuru has witnessed zero cases of misuse of funds or instances of illegal activities on its platform.
Ketto places its bets on blockchain for the growth of crowdfunding platforms in the near future.
Ketto places its bets on blockchain for the growth of crowdfunding platforms in the near future. Varun explains,
“Currently, donating is a two-step process: you support an NGO, and the NGO supports a cause. But there are a lot of steps between you and the beneficiary. Blockchain will eliminate the middleman and will help you provide benefits directly to the person you intend to help.”
He adds that blockchain would also help people raise funds for specific purposes. For instance, a patient can raise funds for her liver transplant surgery alone, while she can pay for her medicine and hospital costs, or raise money for them privately through other means. “Blockchain will help to bring the cost optics down,” Varun notes.
What the law says
While there is no one law that regulates crowdfunding in India, governing body Securities and Exchange Board of India (SEBI) is contemplating ways to regulate the market without obstructing its growth. Since donation crowdfunding works on grants and donations, which provide no financial return in any way, it is presently exempted from SEBI rules. It, however, comes under the purview of the Information Technology Act (2000) and Income Tax regulations. “Donation crowdfunding’s legal implications in India isn’t a cause of worry as NGOs and individuals have been receiving charitable grants for decades. The only difference now is it’s all gone digital,” Piyush says.
Ketto’s Varun hopes SEBI sets up a regulatory framework and lays down the guidelines for the functioning of crowdfunding platforms, as these steps will lend credibility to this sector, and allow for more people to make donations.