Spare change donated at checkout raises millions for charities : NPR

So-called point-of-sale donations have sharply increased in recent years, bringing in hundreds of millions of dollars a year. But the requests to “round up” your bill for charity have really taken off.

Josie Norton for NPR

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Josie Norton for NPR

So-called point-of-sale donations have sharply increased in recent years, bringing in hundreds of millions of dollars a year. But the requests to “round up” your bill for charity have really taken off.

Josie Norton for NPR

We’ve all been there: A store cashier asks if you’d like to donate money to the local food bank. Or the PIN pad at the checkout counter prompts you to round up your payment for charity — spare a little change for a worthy cause.

Those “round-up” campaigns have become ubiquitous in recent years — at grocery chains, gas stations, retail stores and online merchants — and they rake in millions of dollars annually for everything from scholarships to cancer research.

In 2022 alone, charities raised $749 million nationwide through so-called point-of-sale donations, a 24% jump from 2020, according to Engage for Good, which tracks this type of charitable giving. And that was just from campaigns that brought in $1 million or more. Although that figure was tiny compared to the nearly $500 billion in estimated charitable giving in 2022, total giving actually dropped that year.

But it’s the round-up fundraising strategy, which was first introduced about 15 years ago, that has really taken off in recent years, according to Michelle McCarthy, executive director of Round It Up America.

“Especially since the pandemic, we’ve seen a big increase,” says McCarthy, whose nonprofit provides legal and financial guidance for for-profit businesses that collect donations for charities.

Much of that growth is fueled by customer generosity, but those who study consumer behavior point to other factors, too, including how we think about money and even our unconscious feelings of guilt.

It makes sense (and dollars) to ask for less

Michael Rindos says he “almost always” taps the donate button on the credit/debit card reader, or PIN pad. But lately, that’s been changing. “I don’t do it as much as I used to,” Rindos says, as he juggles an armful of groceries outside a Giant Food supermarket in Severna Park, Md., near Washington, D.C.

Rindos said he’s noticed a sharp uptick in the number of requests popping up in places he shops, and it’s become a bit tiresome. “Every place that you go to — Taco Bell, 7-Eleven. They’re all doing it.”

Data suggests that despite being bombarded by such requests, Rindos and others like him are giving more each year at cash registers, self-checkouts and online. And it has resulted in a huge boost for charities on the receiving end. Consider the Taco Bell Foundation, a nonprofit that operates independently from the fast food chain. It brought in $42 million last year on round-ups collected from the company’s more than 7,500 restaurants across the U.S. The average donation: just 44 cents.

Previously, the foundation’s fundraising strategy asked customers to donate $1 to a scholarship program in campaigns that lasted a few weeks or months. “For many years we did that,” says Jennifer Bradbury, the foundation’s executive director. “We had our scholarship program and we had our community grants program, which funds nonprofits like the Boys & Girls Clubs and Junior Achievement.”

But in 2019, the foundation decided to try a different approach. Bradbury says it realized, somewhat counterintuitively, that less is more. “The data we had at that point was that customers were three times more likely to round up than to donate a dollar,” she says.

The results after the switch were “mind-blowing” she says: The foundation roughly doubled what it had been raising, which averaged between $11 million and $14 million annually, but hit more than $20 million in 2019. The change was so successful, the foundation decided to permanently adopt the new strategy. “The number of regular customers who donate every time and round up every time — it’s really inspiring,” Bradbury says.

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