Charity credit cards allow you to support a chosen charity every time you use your card, but are there better ways to donate?
Requiring no extra effort or expense on your part, charity credit cards can be an easy way of donating to non-profit organisations such the WWF, RSPCA and the National Trust.
Card providers will often make an initial donation to the charity when the card is activated and from then on, whenever you use your charity credit card, your provider will give a percentage – usually about 0.25% – of what you spend to the designated charity.
Cashback credit cards or charity cards?
Where most charity credit cards give just 25p for every £100 spent, cashback credit cards can offer far greater rates of reward which you can then personally donate to the charity of your choice.
For example, if you spent £250 a month on Capital One’s World Mastercard – which pays 5% cashback for 3 months and up to 1.25% after – you’d receive £48.75 in cashback over a year.
Meanwhile, the same spending on the Co-operative Bank’s Christian Aid charity card – one of the best charity cards on the market – would net the charity just £25.
Then there’s Gift Aid, the government scheme which allows charities to reclaim tax on your donation.
Gift Aid means that your £48.75 in cashback would be worth £60.94 to the charity with basic rate tax, and £81.25 for higher-rate taxpayers – that’s more than three times as much as the charity card.
The main benefit of a charity credit card is that it does most of legwork for you – all you have to do is spend money on it and the card will take care of the donating.
Yet, while giving to charity via a cashback card requires a bit more effort, the numbers speak for themselves – cashback credit cards beat charity cards hands down.
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