Can spending help save the Earth?

Meanwhile, Arnold cites a few other programs to explore, including:

• Bank of America. It will introduce several green rewards programs by year's end, including the Eco-Friendly Credit Card. For every dollar spent, Bank of America will make a contribution to an environmental organization to invest in greenhouse-gas-reduction projects. The second program, called WorldPoints Rewards for the Environment, is tied to its popular WorldPoints Rewards Program. This will allow existing cardholders to donate their WorldPoints reward points to organizations that invest in greenhouse-gas reductions or redeem their points for environmentally friendly products.

• Wells Fargo. This rewards program allows cardholders to support renewable-energy projects. Cardholders can use reward points, ranging from 5,000 to 10,000 points (translation, $50 to $100), to buy renewable-energy certificates, which support renewable-electricity generation, such as wind power.

• Citibank. Members of Citi's popular ThankYou rewards program can redeem points for a range of environmentally responsible rewards. Cardholders also will be able to donate points to any organization of their choosing through the Your Wish Fulfilled rewards program.

Some key considerations when deciding which card to choose are:

• What cause does the card support?

• How is the environmental cause supported?

• Are the terms and interest rate a good deal?

• How do cards compare?

• Would it be better to contribute to the organization by writing a check?

Cash back versus reward points

A cash-back credit card may be a smart alternative to the rewards/points system.

"More often than not, with any kind of merchandise, you're going to come out ahead using the cash-back option," Arnold says.

"The 1% is not very aggressive. What you can do with cash-back cards these days -- though there has been some scaling back in the last six months to a year -- is still get up to 5% (back) on purchases."

Discover Card and Blue Cash from American Express are just two well-regarded cash-back cards that offer a 5% cash-back return on common purchases, such as gas. This way, you can kill two birds with one stone: You can earn more money to donate to an environmental cause of your choosing, and at a higher rate of return, while enjoying a tax deduction for writing your own check -- something you don't get with rewards program donations.

From an organization's vantage point, one method of giving isn't better than another, says Terry Macko, the vice president of membership and corporate partner marketing for the World Wildlife Fund.

"$1 million received through a credit card program or $1 million received through another type of corporate partnership or $1 million received directly from individuals is all the same to us," he says. "I think what is important is that people give in ways that they are comfortable giving."

The decision of how to give may boil down to convenience.

Waiting until you get a cash-back check, depositing it and writing a personal check may simply be too much for some people to manage in their busy lives. Also, with many programs you must call or go online to cash out or you get a credit to your account.

With rewards programs, the system is automated; the card issuer does the calculations and makes the donation for you. The issuer, of course, also gets the tax deduction.

Do green cards really make a difference?

If you wonder whether these cards truly affect their intended causes, many say the answer is overwhelmingly yes.

"I can tell you that they help a lot -- dramatically," says Macko, who says the World Wildlife Fund has raised more than $10 million during the past 12 years through its relationship with Chase (formerly Bank One and First USA). "So with over $10 million, a lot of conservation work can get done with that."

To put that figure into perspective, for its 2007 fiscal year, the World Wildlife Fund raised $168 million from all channels excluding WWF international and government sources, says a WWF spokeswoman.

Ultimately, marketing is the end game for the organization and the card issuer. The cause wants to raise money and the card issuer wants more customers. Environmentally friendly issues are hot right now, and these business relationships are mutually beneficial.

"I don't think (marketing to green causes) is unique to credit cards necessarily," Macko says. "But I think what you are seeing is that there are a number of credit card issuers who have looked at (green issues) and for good reasons have said, 'How can we tap into what is a market demand of individuals who care and want to demonstrate that they care?' and then funnel the money that normally gets funneled, whether to reward programs or other programs, to fund those initiatives."

Macko says the bottom line for the World Wildlife Fund is how to best help the cause.

"We are all about making as much money as we can for conservation," he says. "The fundraising we do is critical. We can't execute any programs without it."

This article was reported and written by Cherie Berkley for Bankrate.com.

Published Oct. 16, 2007

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