These are credit cards which are linked to a charity. The lenders of these cards usually donate a percentage of all spend to the charity, with a lump-sum being donated when the card is first opened.
When choosing a charity credit card, be certain that you will be able to pay the bill in full each month, and then you can make your decision based solely on the size of the donation to charity.
Not many of these cards actually provide charities with a sizeable donation with most cards offering between 0.25-0.50% of normal spend. There are some exceptions to this, such as the AmexRed credit card which donates 1% of all spend to help fight AIDS in Africs.
Other Banking Methods to Donate to Charity
There is a better way for charities to receive a significantly higher donation and that is through making use of cash-back credit cards and donating the amount earned to the charity. This will allow charities to claim tax aid on your donation providing them with higher donations. For every £10 donation, the charity will receive roughly £13 pounds.
Currently the gift tax aid will remain at 22% for the financial year 2008/9. If you are trying to give as much as possible to charity, spend on your card as much as you can. Transfer the money you would normally be using to pay into your current account – thus allowing you to have the funds available to pay in one lump sum.
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