Article

U.K. eyes ATMs for charitable donations

A British cabinet member has proposed allowing cardholders to make charitable donations at ATMs.

December 29, 2010

A British cabinet member has proposed allowing cardholders to make charitable donations through the United Kingdom's network of ATMs in an effort to boost giving.

Francis Maude, minister of the cabinet office, detailed his idea in what is called a "Green Paper." A Green Paper is an issue the government intends to address.

Maude said his plan would "harness new technology for charitable giving." He added that giving funds through ATMs also would attract individuals who can only donate small amounts of money to charities.

John Low, chief executive of the Charities Aid Foundation, a London and Washington, D.C.-based organization that encourages individuals, corporations and high-net-worth men and women to give to charities, praised Maude's idea. "This Green Paper is welcome as it seeks to kick start some new initiatives, which will make it easy to give and to build up existing ones," Low said.

ATMs possibly would provide cardholders an option to donate funds to a charity, said James Ketchell, senior press officer for the Charities Aid Foundation. The option would appear on the ATM next to buttons for withdrawals and deposits.

Last year, consumers and businesses donated 10.6 billion British pounds (U.S. $16.3 billion) to British charities, he said. U.K. consumers, however, lag other countries. U.K. residents donated the equivalent of 0.7 percent of the country's Gross Domestic Product. In the United States, consumers donated the equivalent of 1.7 percent of the Gross Domestic Product.

Ketchell explained, however, that details of how Maude's idea would actually work are not known and Charities Aid Foundation officials have yet to see the proposal in order to offer a comment.

Officials of LINK, the United Kingdom's ATM organization, also said they have not seen Maude's proposal, but the idea fits in with the organization's strategy.

"One of the payments industry's ongoing goals is to enhance payment options for customers wherever there's clear demand," organization officials said. "We'll be very happy to sit down with government officials to discuss the practicalities, challenges, costs and viability of option of building charity donations into existing card and cash processes."

LINK officials said they want government officials to demonstrate to LINK there is demand for an additional service.

"The technology exists to extend charitable giving, but clearly before considering any such significant change to the payments infrastructure we'd need to understand what evidence the government has to show that there is real customer demand (and how customers' right to choose who their money goes to would be protected)," organization officials said. LINK members operated 62,196 ATMs at the end of 2009, said Jemma Smith, head of public relations for the U.K. Payments Council.

There is evidence that U.K. consumers find donating to charities through ATMs acceptable. Tesco Plc, the U.K.'s largest supermarket chain, accepts donations through its in-store ATM network for its "Charity of the Year." Tesco, which is based Chestnut, England, raised 50,000 British pounds in 2009, Ketchell said. London-based HSBC Bank also uses its ATM network to raise funds for its "Children In Need" campaign.

ATMs owners and operators in other countries also have used their ATM network to raise funds for charities. Kontanten AB, a Stockholm, Sweden-based ATM deployer, recently used its ATM network to raise funds for breast cancer research. Wells Fargo Bank also has used its ATM network to accept donations for San Francisco-area charities.

HSBC Bank also has introduced charitable giving through its ATMs deployed in Mexico, and Servibanca, which is based in Colombia, also accepts charitable donations through its ATM network.

Ketchell noted that U.K. consumers use ATMs to top up their mobile phones, print bank statements and transfer money. "So why not charitable giving?" he said.