National Electronic Payments Month

Collection Agencies to Keep Crowdfunders Honest

Indiegogo campaign owners be warned: Tterms of use lets Indiegogo take more serious measures to return pledged funds to backers after a campaign has breached its terms of service, or hasn't fulfilled its promise to those backers after the a campaign has ended.

A December 2015 study from the University of Pennsylvania, which crowdfunding site Kickstarter now has housed on its site, found that 9 percent of Kickstarter campaigns did not deliver rewards promised to backers.

To this point, backers have mostly taken the hit as platforms don't always guarantee projects. In May, PayPal ended protection it offered customers investing in crowdfunding campaigns, meaning no more refunds when the campaign goes awry.

Indiegogo also published a blog post on trust and safety saying, "We will do everything in our power to recover funds for our backers, including contacting third-party collections agencies." Though, the post also said in certain cases, the platform will reach out to the campaign owner first.