Card Companies Drop Fees on Haiti Relief

Credit card companies have dumped fees after charges on Haiti earthquake relief donations caused a shakeup.

Several credit card companies have waived their per-use fees, known as "transaction" fees, on Haiti relief donations made with their cards after a public spotlight was shone on the practice.The fees provide the issuer with a small maintenance charge each time a card is used.

American banks and credit card companies could make as much as an estimated $250 million each year from transaction fees on charitable donations, according to a story on the website The Huffington Post.

The fees caught heat from Senator Christopher Dodd, D-Conn., who spoke out against the practice on his website.

“Across the country, Americans are offering their hard-earned dollars to aid the Haitian people, but their donations could do more if credit card companies weren’t skimming off the top,” Dodd said. “I urge credit card companies to join the cause and waive the transaction fees that are taking these generous donations away from the Haitian relief effort.”

In response, the major credit card companies – Visa, MasterCard, American Express, and Discover - chose to waive some of their fees. Visa chose to nix fees on donations to 11 established charities, while American Express chose to waive fees for 65 charities.

"The criteria for when we decide to waive these fees for charities is guided by the level of response from the Red Cross," Christine Elliot, an American Express spokesperson, told The Huffington Post. "We waive the fees when the Red Cross internally designates something a 'catastrophic event,' and we only waive them for the charities designated by USAID because we have confidence that they've done due diligence in determining what is a reputable organization."

MasterCard waived the fee for five charities; Discover waived for only the American Red Cross.