Socially responsible credit card?
December 29, 2013 5:21 PM   Subscribe

I need to sign up for a new credit card and am looking for one that is as socially/environmentally responsible as possible (i.e. not tied to big banks, corporations and/or oil companies who would be profiting off me as a consumer and doing bad things with that profit). Does such a card exist? I've searched online but am wary of bias.
posted by athousandtelephones to Work & Money (10 answers total) 3 users marked this as a favorite
Sounds like a good place to start would be a local NCUA member - a credit union that issues their own card. Most cards will have a Visa, MasterCard, Novus, or AmericanExpress logo to be usable throughout the country (presuming United States here ...) so there's not much you can do to keep those processors/network licensors from earning money and doing what they will with it.

Not heard specifically of a card that does this; a quick Googling gives me a BofA card that supports the World Wildlife Fund, but you're still giving money/business to BofA.
posted by tilde at 5:25 PM on December 29, 2013 [1 favorite]

Does such a card exist?

Look, you probably need something in the neighborhood of a billion dollars in cash to be in a position to issue a card under your own name. Who do you think has that kind of money? That's right: big banks and major corporations. And most of them do it through one of four card-issuing companies, i.e., Visa, MasterCard, Discover, and American Express.

There's a reason for that. Simply put, if you want your credit card to actually work like a credit card, it has to be connected to the credit card interchange network, at least two banks (merchant and creditor), and a payment processor. You can't just decide to issue a credit card and, hey presto!, start running transactions. It's a massively complicated, interconnected system which is for all intents and purposes owned and operated by multi-billion dollar financial institutions.

Even credit unions aren't really going to be helpful here if they're routed through Visa, MC, AmEx, etc. And credit unions as such aren't quite as consumer-friendly as they're frequently made out to be. They're basically for-profit entities just like commercial banks, they just have the advantage of a different set of (favorable) federal financial regulations working for them.

If you want a credit card, you're just going to have to face the fact that someone is going to be profiting from said card, and that someone probably isn't someone you'd approve of.
posted by valkyryn at 6:13 PM on December 29, 2013 [2 favorites]

posted by Lettuce_Leaves at 7:04 PM on December 29, 2013

not tied to big banks, corporations and/or oil companies who would be profiting off me as a consumer

Companies issue credit cards for the same reason the baker bakes and the farmer farms: to make a profit. They don't do it to break even and they certainly don't do it to lose money. You can get a card that donates to a given cause with every purchase, but you will still be using Visa/Master Card/AmEx's networks. You will have to decide for yourself if that tradeoff is acceptable to you.
posted by Tanizaki at 7:28 PM on December 29, 2013 [1 favorite]

Oil companies? Other than the fact that the cards are made out of plastic, credit card companies don't really have anything to do with the oil industry.
posted by Hatashran at 8:51 PM on December 29, 2013

Back when telephones were a thing my friends and I all used Working Assets. They have a credit card.

Caveat: I have no idea how socially responsible they actually are now (or were then, to be honest) but it made us feel warm and fuzzy.
posted by Room 641-A at 8:55 PM on December 29, 2013 [1 favorite]

You haven't said WHY you need a new CC, I personally don't use them at all for my business or my personal use. I use debit cards for both. Is that a possibility for you?
If you MUST have a CC, how about you sign up for any one of these credit cards you don't like and pay off the entire balance BEFORE the interest kicks in. Seems to me that would solve your problem of them not profiting off of YOU, as the only real profit they make is either interest or late fees or penalties. By paying off your balance you avoid all those things. They still might make a little off of transactions fees from the store you purchase things from, but thats already factored into the selling price at most chains and is something you have no say over unless you avoid it completely by using cash.
posted by HappyHippo at 9:14 PM on December 29, 2013

There are socially responsible cards, but your options are somewhat limited, here are several cards that are issued by community development banks and credit unions that have some social-development component to them.

(Full disclosure, I recently accepted a position at Green America, who compiles that list.)
posted by thebestsophist at 11:40 PM on December 29, 2013

here are several cards that are issued by community development banks and credit unions that have some social-development component to them.

That's good as far as it goes, but it doesn't actually do what the OP was asking for. Note that every single one of those is either a Visa or a MasterCard, meaning that one of the two is making money on the deal, which means their respective banks are too.

The best you can reasonably expect to do here is to have the money that would be given back to you in the form of reward points or cash back donated to specified charities instead. But Visa/MC and their banks are going to make the same amount of money they were always going to make.

As further explanation, understand that these companies make a significant amount of money on float. "Float" is basically the money sitting in financial institutional accounts after being debited from the buyer while the payment is processed. Usually just overnight, and recent legal reforms have shortened this period significantly, but even now, several days is not impossible. Interest rates on those accounts are miniscule, but the US economy sees upwards of $1 trillion in credit card transactions every year. All of that spends at least some time in a float account. Even 0.01% is $10 billion in basically free money for the card processing industry. Heck, payroll companies make a ridiculous amount of money riding the float between the time their clients deposit payroll funds and said funds are disbursed to employees.*

You'll never be able to eliminate people profiting off the float your transactions generate unless you stop using any form of payment other than cash. So unless you're willing to avoid that entirely, there's absolutely no way of making sure that no entities that you disapprove of are making a profit from your transactions. Can't be done.

*That can be upwards of a week. I know one payroll company that gets the majority of its profitability from interest on float. Overnight investable funds are that big of a deal. Why is beyond the scope of this question, but there you have it.
posted by valkyryn at 7:38 AM on December 30, 2013 [1 favorite]

Check out Dwolla. They're not 'there' yet, but they hope to upset the credit card companies' monopoly and ridiculous charges.

A tangent, I know, but still worth looking at.
posted by 4midori at 11:32 AM on December 30, 2013

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