If you’re seeking donations for a charitable endeavor, such as your kid’s soccer team or for your favorite nonprofit, try asking for donations in cash instead of credit.
According to a November 2015 study in the Journal of Consumer Research, people who pay for a donation with inconvenient cash instead of easy-to-access credit tend to feel more warmly toward the organization they’re supporting and are more likely to give again.
“The pain of payment may have an economic upside,” write study authors Avni M. Shah, Noah Eisenkraft, James R. Bettman and Tanya L. Chartrand in an early working version of the report. “More painful methods of payment may help instill the loyalty and commitment that charitable organizations depend on.”
According to the authors, paying with cash or with a check is more psychologically painful than paying with plastic because people are more in touch with the money that’s being spent. Paying with a credit or a debit card, by contrast, is less agonizing. “The ritual of swiping a card obscures the cash value of the transaction, divorcing people further from its economic reality.”
Because paying with plastic is so easy, people tend to think less about their spending and, as a result, tend to feel less connected to the organization they’ve chosen to support.
People who pay with cash, by contrast, are more invested. Because the payment was harder to make, they often rationalize the money they spent and think more fondly of the organization they sponsored. They also become more likely to make a repeat donation.
“Even when the objective cost remains constant, we argue that when individuals pay using a more painful method of payment, they compensate for and justify the psychological pain they experience by showing more commitment to their chosen alternatives, both psychologically and behaviorally,” write the authors.
I can relate. Every once in a while, my local grocery store helps fundraise for a local nonprofit by setting up a donation stand in the middle of the store. Whenever I pass the stand, I stop for a moment and fumble through my purse, looking for a few dollars in spare change.
I always remember these donations and try to give as often as I can, even though I rarely have much cash. I also take the time to read about the organization when I can and leave feeling more committed toward the group I helped sponsor.
But the experience is much different when I make a similar donation with a card. If I give money at the checkout counter by adding a few dollars to my credit card payment, I usually forget about the donation and the nonprofit I helped support as soon as I walk out of the store.
Paying for a donation with a credit or debit card just isn’t as memorable or as satisfying as paying for it in cash — perhaps because the payment is so quick, I don’t have time to really think about it.
The next time you make a donation, consider how you pay for it. Paying for a donation with cash may feel more meaningful since it makes you more aware of the money that you’re spending. The more you think about your payment, the better you’ll feel about the sacrifice you made for someone else’s benefit.