How Your Credit Card Can Help You Give Back

Don’t have extra money to give to charity? Believe it or not, your credit card could help you with your philanthropic efforts.

Author:: Jeanine Skowronski
Publish date:: Feb 9, 2012 9:00 AM EST

NEW YORK (MainStreet) — Don’t have extra money to give to charity? Believe it or not, your credit card could help you with your philanthropic efforts.

Most issuers, including American Express (Stock Quote: AXP) and Discover (Stock Quote: DFS), allow their cardholders to donate their rewards points to partner organizations.

Capital One (Stock Quote: COF) actually has an entire website dedicated to helping cardholders schedule donations in either dollars or rewards points to one of 1.2 million charities. The issuer absorbs the transaction costs associated with the donation so that 100% of the funds make it to your charity of choice.

There are also specific credit cards that have charitable giving worked into their rewards program. The OneCause Visa (Stock Quote: V) Platinum card, for instance, contributes 1% of total purchases to a cardholder’s chosen cause, and you’ll also earn your organization a $20 bonus contribution the first time the card gets used.

Bank of America (Stock Quote: BAC) has a line of co-branded credit cards that give a percentage of the total purchases you make with the card, plus a donation at the account’s onset, to various charitable organizations, including the Special Olympics, the American Lung Association and Ronald McDonald House Charities.

Some credit cards inspire giving by offering extra rewards points back on charitable donations. U.S. Bank’s FlexPerks Visa Triples Rewards, for instance, lets cardholders earn triple FlexPoints on donations to many 501(c)(3) nonprofit organizations. Other issuers like Chase (Stock Quote: JPM) have incorporated charitable donation in the revolving 5% cash-back categories associated with some of their credit cards.

It’s important to note that some debit cards can aid you in your philanthropic efforts as well. Target (Stock Quote: TGT) will donate 1% of purchases made with its REDcard debit card to a K-12 school of the cardholder’s choosing, and Capital One partners with six different charities to offer co-branded debit cards that earn each organization 0.2% on signature-based transactions made by the cardholder. Capital One customers can also elect for a debit card that splits the earnings among all six charity partners.

—Jeanine Skowronski is staff reporter for MainStreet. You can reach her by email at Skowronski.jeanine@thestreet.com, or follow her on Twitter at @JeanineSko.