Congressman Cohen to Introduce Bill to Encourage Increased Credit Card Charitable Donations
January 19, 2010
Congressman Cohen’s legislation would limit the amount credit card companies could charge for administrative costs associated with processing charitable donation transactions, as opposed to the existing interchange rate which can be as high as five percent per donation. This would ensure that more of the money that Americans donate to charitable organizations reaches the intended organization.
“In the aftermath of a crisis, like the earthquake in Haiti, Hurricanes Katrina and Rita, or the tornadoes that affect our area, Americans are encouraged to pledge what they can to help people recover,” Congressman Cohen said. “As much as possible, the full amount of donations to religious, artistic, and community organizations should be received by the intended recipient, and my legislation will accomplish that.”
“While I understand that credit card companies incur some expense in processing these donations, I believe that they should only be allowed to collect for minimal administrative expenses, and not the existing consumer interchange rate that is charged to merchants for credit card transactions,” Congressman Cohen said. “Under my legislation, charitable organizations, like St. Jude, would no longer have to negotiate for a lower interchange rate on their donations, and would only be charged the actual expense for processing the transaction, which would be far lower.”
“While I appreciate the fact that the credit card industry has suspended their normal interchange rate for 60 days for donations in the wake of the earthquake in Haiti, I believe that reducing these fees permanently will spur greater charitable donations to organizations in our country,” Congressman Cohen said. “Charitable donations are down in this economic recession and this legislation will make sure that as much money as possible gets to 501c3’s to help support social and community services, the arts and educational foundations.”
“In the aftermath of a crisis, like the earthquake in Haiti, Hurricanes Katrina and Rita, or the tornadoes that affect our area, Americans are encouraged to pledge what they can to help people recover,” Congressman Cohen said. “As much as possible, the full amount of donations to religious, artistic, and community organizations should be received by the intended recipient, and my legislation will accomplish that.”
“While I understand that credit card companies incur some expense in processing these donations, I believe that they should only be allowed to collect for minimal administrative expenses, and not the existing consumer interchange rate that is charged to merchants for credit card transactions,” Congressman Cohen said. “Under my legislation, charitable organizations, like St. Jude, would no longer have to negotiate for a lower interchange rate on their donations, and would only be charged the actual expense for processing the transaction, which would be far lower.”
“While I appreciate the fact that the credit card industry has suspended their normal interchange rate for 60 days for donations in the wake of the earthquake in Haiti, I believe that reducing these fees permanently will spur greater charitable donations to organizations in our country,” Congressman Cohen said. “Charitable donations are down in this economic recession and this legislation will make sure that as much money as possible gets to 501c3’s to help support social and community services, the arts and educational foundations.”