A study has found that small charities are losing more than a £1000 a year by paying over the odds for utilities

Charities are losing money by failing to change their electricity or insurance providers.

A study has revealed four in 10 small charities are losing an average of £1,200 a year because they lack the time required to seek cheaper alternatives to their incumbent suppliers such as insurers and energy companies.

An online health-check survey, conducted among 125 small charities, was carried out by financial advice website, Back of the Sofa.

Three quarters of the groups who took part are registered with Scotland’s Charity Regulator (OSCR) or the Charity Commission and included: churches, village halls, scout groups and community centres.

The survey reveals how failing to switch suppliers has led directly to respondents suffering financially.

The study found that groups were paying uncompetitive rates of 14p-25p per unit for electricity, that 43% received no more than 0.1% interest on their cash reserves and 75% have allowed their insurance to automatically renew without shopping around

Almost half (42%) said they had yet to register for Gift Aid.

Nick Heath, founder of Back of the Sofa, said: "Small charities are often held back because they lack the resource to make informed money-related decisions.

“The time and effort perceived to research non-essential alternatives leads to a better the devil you know attitude and misguided loyalty towards existing suppliers. Fortunately for those involved in the finances of charities, there are short-cuts that can be taken to tackle this and platforms, like ours, to signpost them."