Card Issuers Step Up for Haitian Relief Efforts

On January 12, 2010, a 7.0 magnitude earthquake hit the island nation of Haiti.  The quake devastated the country that is the poorest in the Western Hemisphere.  As donations pour in, mostly by credit card charges to charitable organizations, a recent Huffington Post article reports that banks and credit card companies have reaped profits with a 3% transaction or interchange fee on every donation. Interchange fees are charged by a bank to process credit cards, ATM or debit transactions from another bank. Though 97% of the money does go directly to help, it’s that 3% bank fee that has people angry.

Public Outraged

Tired of fee hikes, interest rate increases, government bailouts, and big bonuses, the public is yelling foul as banks take the standard transaction fee off the top of credit card donations to the Haitian relief effort.  The banks and credit card companies argue that if they give charity organizations a lower rate, other companies will want the same rate discount.

Some Credit Card Companies Agree to Waive Fees

Facing a publicity nightmare many banks and credit card companies are reacting to the criticism waiving fees for some contributions:

Visa
• Waiving interchange fees through February 2010 on donations made to certain charities:  American Red Cross, Habitat for Humanity, Save the Children and World Vision, America Cares, CareUSA, Direct Relief international, International Rescue Committee, Mercy Crop, Oxfam American, US funds for UNICEF.
• Donating $200,000 to the American Red Cross Haitian Relief and Development Fund.
• Will match employee donations to Haitian relief efforts on a 2 to 1 basis through January 2010.
• Will donate revenue generated by charitable contributions to the crisis in Haiti to Red Cross.

Master Card
• Waiving interchange fees on Haitian relief donations that are made using U.S. issued cards to certain charities: American Red Cross, CareUSA, Doctors without Borders, and United way.
• Donating $250,000 to the American Red Cross.
• Double matching employee contributions to Haitian Disaster Relief Fund of the American Red Cross.

American Express
• Donating $250,000 spread out among American Red Cross, Doctor’s without Borders, International Rescue Community and Friends of the World food program.
• Will match employee donations.
• Will rebate the merchant discount rate for charitable contributions made on American Express cards to agencies listed on the USAID website in support of Haitian Relief retroactive January 12-Febraury 28, 2010.

Discover
• Donating $100,000 to American Red Cross.
• Pledging up to 1 million dollars through card member matching program.
• Waiving transaction fee on all credit card donations to American Red Cross.
• Match employee donations dollar for dollar.

Bank of America: America’s 2nd largest credit card issuer.
• Will waive associated foreign transaction fees for customers making a donation with a Bank of America debit or credit card to charitable organization supporting Haitian relief efforts.

Capital One: issues Master Card and Visa credit cards
• Through their No Hassle Giving program 100% of donation charged on a Capital One credit card goes to charity, all transaction fees waived.
• Customers can choose from among 1.2 million eligible charities including American Red Cross, Doctor’s without Boarder, Partners in Health, Direct Relief, and Global Giving.

Customers Continue to Give

Though some credit card companies and banks have agreed to waive fees, not all have. Consumers have found ways to bypass credit card donations by texting, sending checks, and dropping off cash at donation centers.  Whatever way people are choosing to give, this looks to be one of the biggest charitable contribution efforts in history.

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This entry was posted on Tuesday, January 26th, 2010 at 9:00 am and is filed under Credit Card News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.