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Giving to a charity can be a great way to spread goodwill and support causes you believe in. There’s also the added benefit of a tax deduction for any eligible donation over $2. But there can also be additional costs, such as admin or card-processing fees, which water down your contributions.
You can use this guide to learn about the different ways you can make charity donations with a credit card – including a couple of charity credit cards. Plus what it can cost and how to find out what your donation is used for.
While charities may charge a fee for donations made by credit card, it should be limited by what it costs them to process the payment. Usually this ranges from 0.5% to 3% depending on the card, with Visa and Mastercard credit cards typically attracting a lower fee than American Express cards. So if you made a $100 donation using your credit card, you could pay an extra $0.50 to $3 for the transaction.
Some charities may also pass on other admin costs, such as direct debit subscription charges or membership fees. Make sure you check for these costs before making a donation so you know exactly how much you’ll end up paying.
This varies based on a range of factors, including how the charity has set up its donations. For example, if a charity uses an online donation platform such as Donate Planet, GoFundraise or Everyday Hero, then the administrative fees they’ll pay could be anywhere from 0% to 6% of each donation received. Straight away, that means up to 6% of what you donate will go towards these costs.
Fortunately, many charities offer information about how your donation will be used. For example, the Salvation Army website states that it has some of the lowest admin costs in Australia, with around 12 cents per $1 donated going towards administrative costs. Similarly, CARE Australia’s website explains that 13 cents per $1 went towards administration and fundraising costs in 2015. The charity also makes its annual reports available so you can see where money is going.
If you use a reward or frequent flyer credit card to make a charity donation, you could also earn points per $1 spent. Keep in mind that you’ll only earn points for your donations if they’re processed as “purchases”, with most reward programs excluding cash advance transactions and BPAY payments from earning points. In most cases your donation should be considered a regular purchase, but if you’re unsure, contact your credit card provider to ask about how your donation will be processed.
Many credit card reward programs also let you use points to make a donation to participating charities. This can be a convenient alternative if you don’t want to use your card to make a donation or if you want to avoid additional fees.
Use the table below to check out different credit card reward programs that let you redeem points for a charity donation. We’ve also listed the charities available and the minimum points you’ll need for a donation.
| Rewards program and their charity options | Minimum points required for a donation |
|---|---|
American Express Membership Rewards
| From 5,000 points for a $25 donation |
ANZ Rewards
| From 4,690 points for a $25 donation |
CommBank Awards
| From 4,650 points for a $25 donation |
NAB Rewards
| From 1,540 points for a $10 donation |
St.George Amplify Rewards
| From 3,400 points for a $20 donation |
Westpac Altitude Rewards
| From 3,400 points for a $20 donation |
Minimum point values accurate as of 6 January 2020.
While reward options can vary between programs, generally you’ll be able to redeem points for a charity donation in the same way you’d redeem a gift card or merchandise. In most cases, this is as simple as logging in, going to the rewards store and searching for “donations” or “charities”. Then you can select the organisation you want to support and follow the prompts to redeem your reward.
While the table shows the minimum points required for a donation, reward options might vary based on the charity you want to donate to and the amount you’d like to donate. This is the case even within the same rewards program.
For example, while charity donations made through the Westpac Altitude Rewards program start from 3,350 points, this is only available if you redeem a $20 donation for Good Return. A $20 donation to Oxfam or Starlight Children’s Foundation, on the other hand, costs 3,400 points.
The dollar value of the reward points you use for a donation also varies between credit card reward programs. The table below gives you a breakdown of the points-to-donation values for the reward programs offered by American Express, ANZ, NAB, St.George and Westpac.
We’ve also included details of the average points you could earn per $1 spent with a personal credit card linked to one of these reward programs. Keep in mind this is an average based on the earn rates for each personal card that earns rewards, so you could earn more or less points depending on the rewards card you use.
| Reward program | Points redeemed | Donation value | Donation per point | Avg points earned per $1 spent on purchases | Donation amount per $1 spent | Rank |
|---|---|---|---|---|---|---|
| Amex | 3000 | $25.00 | $0.008333 | 1 | $0.008333 | 1 |
| ANZ | 4685 | $25.00 | $0.005336 | 1.5 | $0.008004 | 2 |
| NAB | 1540 | $10.00 | $0.006494 | 1 | $0.006494 | 4 |
| St.George | 3400 | $20.00 | $0.005882 | 1.167 | $0.006865 | 3 |
| Westpac | 3350 | $20.00 | $0.005970 | 1.083 | $0.006466 | 5 |
Based on these details, American Express and ANZ offer the most value for money if you want a credit card that lets you use points to contribute to charity.
Another option is to get a credit card that’s linked to a specific charity. These cards give you a way to support charity through regular, automatic donations from your account. Currently, there are two charity credit cards you can consider:
Here are some other key factors to keep in mind when you’re planning to use your credit card to make a donation to charity:
Whether you want to make a one-off donation or support a charity on an ongoing basis, credit cards can be a convenient way to make donations. Some cards also give you alternative ways to support charities through rewards programs or ongoing partnerships. But remember to weigh up the cost of any fees and check how your money will be used so that you can make every donation count.
Pictures: Shutterstock
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