Comments on: Are Credit Card Companies Evil if They Don’t Waive Fees on Haiti Donations?

By: Joel

Joel — Sat, 06 Feb 2010 02:59:58 +0000

Thanks, Len – It is really funny to hear people act as if the credit card companies don’t actually DO anything to earn those credit card processing fees. I guess maybe because its not a physical good but rather a service that they provide that it is harder for people to see than if say Dell sold a bunch of computers to a charity.

By: Len Penzo

Len Penzo — Fri, 05 Feb 2010 23:24:45 +0000

Well done, Joel.

The credit card companies deserve to earn a profit for providing a service.

Those that are squawking forget that without the convenience provided by the credit card companies, many many many donation would never have been made in the first place.

People that feel differently can try putting some real dollar bills in an envelope and sending their donation via the postal service, or find CC companies that have decided to waive the fees.

Best,

Len
Len Penzo dot Com

By: Joel

Joel — Sat, 23 Jan 2010 05:29:40 +0000

Thanks for the comment. Credit card companies do not profit obscenely when there are major disasters and people donate in large numbers. As I mentioned above it costs billions and billions of dollars to develop and maintain the complex payment systems that allow people to be able to so quickly and securely be able to give to charities all around the world in just a few seconds rather than having to wait to mail a check or wire money.

When people give to a charity there is no requirement that people give using a credit card just like there is no requirement that the charities themselves even have to accept credit cards in the first place. If people do not want to use their credit card then they do not have to just like if a charity does not want to accept credit cards then they do not have to. However, if a credit card is used then why shouldn’t they be compensated via credit card processing fees for the very valuable service they provide?

I am all for credit card companies waiving fees for charitable contributions but lets take a step back and be honest with ourselves here. If they choose to waive fees it is certainly not because they should feel obligated to or because there is something wrong with them continuing to charge fees just like any other company that sells a product or a service to a charitable organization. If they want to make a donation of the fees that they earned then that is great but if not then there is nothing wrong with that at all.

By: Jamis5410

Jamis5410 — Thu, 21 Jan 2010 19:47:36 +0000

The problem is credit card companies profit obscenely when there are major disasters and people donate in huge numbers. There IS something morally wrong with funneling millions into bank profits instead of letting them go to suffering people in a crisis.

The credit card companies make a killing with Hurricane Katrina, and it’s hard to argue that these companies have any kind of heart since the only reason fees for Haiti were waived was they were completely shamed by the public.

The waived fees only apply for a month and only apply to specific charities.

If a local church is organizing an immediate aid team to Haiti, for example, and people contribute at their web site using credit or debit cards why should Visa and MC get as much as a 3%-5% cut?

If Visa and MC get to decide what’s a worthy charity why doesn’t the credit card industry also refuse to permit credit or debit transactions with “charities” that are known to be scams? Because they want their cut….

By: Financial Samurai

Financial Samurai — Tue, 19 Jan 2010 21:30:50 +0000

Yes, I agree thre is nothing wrong essentially with a company or person charging for a service to make a living. That is the American way! Instead of demonizing a specific company for not waiving the fee, just use another card!

By: Joel

Joel — Tue, 19 Jan 2010 01:39:50 +0000

Exactly right – I think that it is a good thing for credit card companies to waive fees especially because even aside from being socially responsible it makes great business sense as people that care about this issue would be prone to take our business to a different card issuer that did waive fees.

All in all the takeaway though is that consumers have a right to choose and credit card companies have a right to choose and there is nothing morally wrong about charging credit card processing fees even on charitable contributions just like there is nothing morally wrong for any other company to charge a charitable organization for their goods and services.

Wouldn’t you agree?

By: Financial Samurai

Financial Samurai — Tue, 19 Jan 2010 00:26:02 +0000

Tough call Joel. If there’s a massive movement going around that CC companies are waving fees, to be the outlier and not wave a fee will probably result in big marketshare loss if the public finds out.

I see your point that it is a CC company’s business regarding fees, but I’m of the camp that yes, if AMEX or my Citibank Home Rebate card gives me the option to donate, and doesn’t wave a fee, I’m inclined to switch to a more sociably responsible CC company. They can do whatever they want, and so can I.