Crowdfunding gives new purpose to remittances in Moldova

September 16, 2020

Illustration by Alex Buretz

Even though, on one hand Moldovan households seemed to prosper, including due to money transferred from abroad, on the other hand there was still no supply of drinking water and no access to sewerage systems. Although children had new bicycles and kick scooters, they didn’t have a park with alleyways and sidewalks to ride them safely. Although pupils had nice-looking shoes and clothes to wear to school, local roads were snowed-up or muddy, with no tractor available to clean access ways. Such inconsistencies are still prevalent.

For three decades now, Moldovans have been looking for emigration possibilities in pursuit of a decent life. Sometimes, they spend up to 90% of money earned on essential goods and services, according to an Expert-Grup study. At the same time, thousands of Moldovans are disconnected from local realities and do not know how to participate in the development of their hometowns and what are the main issues the latter are struggling with.

Changing the vector of local development with diaspora’s involvement

Since 2015, with support from UNDP and Switzerland, Moldova has been making its first steps to reroute the vector of local development with diaspora’s involvement. It was for the first time that one third of the local population gone abroad was asked by the mayoralty: “What would you like us to change in your hometown?”. The answers did not take long to come in: “Renovated park, good roads, safe sidewalks, quality water and sewerage, business opportunities at home.” This way, local authorities and people gone abroad from villages and towns decided together – both online and offline – how to develop their communities in the best way.

The local public administration and hometown association applied a spectrum of online tools: social media for communication and online questionnaires to consult with the diaspora. However, the absolute novelty was raising funds online for local projects – crowdfunding.

Raising funds door to door and using lists with confirmation signatures seemed irreplaceable

“It was in 2017 that I have first heard of crowdfunding, and we needed to manage a complex process based on this concept. We were used to collecting funds, going door to door, using list signed by each donor, and it seemed to us that nothing could replace it.

When we were told about a new way that was also more efficient, we weren’t confident about it, we were inexperienced, and we were also not familiar with online tools and steps that needed to be undertaken in a crowdfunding campaign,” said Valentina Carastan, mayor of Slobozia Mare village.

The trainings provided by UNDP made crowdfunding easy to tackle and that is how local stakeholders moved to the next level of raising funds.

“We could not believe it when we managed to collect the money from natives for renovating a section of the local water pipeline. We are currently using crowdfunding for the third time for a local project, which is about building an agri-food market,” noted the mayor of Slobozia Mare.

All these barriers – psychological and financial – were overcome by the first 38 communities that implemented 55 community projects during 2015-2018, by using crowdfunding. Thus, 10,000 local inhabitants and migrants contributed with US$ 257,000. The total budget of the initiatives, including the contribution of local authorities and the grant provided by Switzerland, amounted to $2.52 million. As a result, about 300,000 people have access to better public services at home.

This movement revolutionized crowdfunding in Moldova. The examples set were followed by other 44 communities in 2019.

The Crowdfunding “Academy” helps the diaspora succeed at home even during the pandemic

Crowdfunding continues to be the lifebelt during the COVID-19 pandemic, dozens of hometown associations having raised funds for personal protective and medical equipment.

Often, things that were thoroughly worked on, become a GIFT [in Romanian: DAR] during crises. Crowdfunding-related achievements fit like a glove during the pandemic.

“All the experience accumulated by UNDP and Switzerland in the area of crowdfunding makes for a true crowdfunding ‘academy’, considering that local communities are initiating more and more calls for crowdfunding and resource mobilization, especially during the pandemic. That also refers to the 72 projects funded by UNDP and Switzerland this year, many of them include crowdfunding as well,” said Zinaida Adam, manager of UNDP-Switzerland “Migration and local development” project.

In July, new communities enrolled at the crowdfunding “academy”. The new “followers” and supporters are the Bureau for Diaspora Relations of the State Chancellery and the Congress of Local Authorities from Moldova.

These two institutions are now guiding the diaspora and the local authorities on this charted path by UNDP, with the support from Switzerland. Recently, a crowdfunding guide has been published, both in printed version and online.

The snowball effect in Moldovan crowdfunding

Crowdfunding turned from something unknown into an opportunity for communities to value. Hometown associations learned how to use national and international crowdfunding platforms, including via social media, and were informed about the conditions, commissions charged from the raised amount, how long it takes for the money to be transferred, etc.

They also learned how to develop compelling campaigns, with motivation slogans, and videos that take one closer to clicking the “donate” button. The associations realized how important it is to publicly thank the donors thus creating a snowball effect. That way, some of them, even those that were initially skeptical, managed to collect as much as 102%, 150% or 200% of the targeted amount.

During August 2020, a new wave of local crowdfunding campaigns was launched for local economic development and local services development projects, such as streets lighting, roads and markets rehabilitation, parks renovation and establishment of multifunctional centers.



Incubator – Accelerator 1+1 – DAR 1+3

Since it is difficult to raise tens of thousands of dollars from the diaspora on the first try, due to resistance and other unknown factors, UNDP and Switzerland set up several support programs for hometown associations:

  • “Incubator” – $1,000, requiring 10% co-financing from the diaspora;
  • “Accelerator 1+1” – up to $10,000, requiring equal co-financing amount from the diaspora.

One of the communities that “graduated” successfully from both programs is Geamana.

“Last year we received $1,000 grant. We also had to collect funds from the diaspora for renovating the central park in the locality. This year we set out to build an agri-food market. In that sense, Swizterland helps us with $10,000, the local administration allocates $21,000, and the natives are urged to contribute approximately $7,000 through a crowdfunding platform. The agri-food market in Geamana will be a place to buy eco products for people from the center of the country. At the same time, it will be a source of income for the producers from Geamana, hence allowing them a decent living,” highlighted Elena Malairau, chairperson of the hometown association from Geamana “Generation G”.

The good practice of involving diaspora in local development, supported by these two programs – “Incubator” and “Accelerator 1+1” – culminated this year with the governmental program “Diaspora acasa reuseste 1+3” [Diaspora succeeds at home 1+3]. Thus, the 42 beneficiary communities of the DAR 1+3 program intend to collect overall $205,724, which is, on average, $5,000 per community.

“Crowdfunding is one of the innovative tools that the Bureau for Diaspora Relations needs to bring the diaspora closer to home. This is the first implementation year for the DAR 1+3 Program, and since it coincided with the outspread of the pandemic, it could have failed if not for such tools as crowdfunding. We are grateful to UNDP and Switzerland for assistance and sharing valuable experience. It’s only through such approaches that we can prove that the diaspora succeeds at home,” said Valeriu Turea, head of the Bureau for Diaspora Relations of the State Chancellery of the Republic of Moldova.

Over the last four years, local communities and the diaspora made crowdfunding work for local development.