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2 TAKES ON NONPROFIT GIVING “No-bake cake sale” and school logo debit card program raise big bucks By Steve Cocheo, executive editor
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ou don’t usually hear banks a dver t i si ng t h at t he y g ive away money, especially not on New York City-area drive time radio. But there it was, a spot promoting the Community Alliance Program (CAP) of Boiling Springs Savings Bank of Rutherford, N.J. One community organization leader, accustomed to traditional fundraising efforts, calls CAP “the nobake cake sale.” CAP is less caloric, but pretty sweet. With no outlay at all, community groups can receive quarterly payments from the bank that can come to hundreds, even thousands of dollars.
Finding a new way Banks rank high among supporters of local community organizations. Often aid takes the form of outright grants, but as nonprofit groups began asking for more help, Boiling Springs ($1.4 billionassets) found a path to increase support in a way that benefitted the bank beyond goodw ill. In br ief, the ba nk ma kes donations based on deposit balances and other relationships maintained in accounts opened by supporters of a particular nonprofit group. Since its launch in 2006, through the end of 2014, the bank donated over $1.8 million to hundreds of charities. The organizations cover the gamut of community groups, ranging from scout troops to fire departments to shelters and food pantries to service organizations. In 2010, the bank received an ABA Community Bank Award for its efforts. When Boiling Springs began the program in 2006, $15,611 went to eight nonprofits in the bank’s five key county markets. In 2014, the bank donated $385,567 to more than 350 groups.
High balance, high donation Here’s more detail how CAP works. An eligible organization opens a checking or savings account for as little as $100, if it doesn’t already have an account at Boiling Springs that can be designated for receiving the bank’s donations. Then the nonprofit organization can ask its 34
BANKING EXCHANGE
May 2015
For banks that give to customer-selected nonprofits, based on account balance or debit card use, the results are sweet: community support and market share growth members or other supporters to designate that nonprofit as a recipient of donation credits ba sed on suppor ters’ banking relationships with Boiling Springs. (The bank will fund the opening of an account if required to get the nonprofit into the program.) Once 20 supporters so designate their existing accounts, or move business to Boiling Springs, the bank begins measuring and tracking the relationships to compute donations. Supporters can specify certain accounts for a specific participating nonprofit if they support more than one in the program. Or they can mark all accounts to a single group. The donations come str ictly from the bank, not from the organization’s
suppor ters. The bank donates at an a nnua l rat e of ¼% on CDs, ret ire ment CDs, and premium and money market checking. The bank computes donations at an annual rate of ½% for checking, savings, and money market savings accounts. (The computations are applied to average daily balances in a given period.) No fees are charged to the groups or the supporter-customers for participation in the program. To this original retail account framework, Boiling Springs added business accounts, with donations based on 1/10% of average daily balances. The bank also gives supporters the ability to count new mortgage and home-equity loans, as well as outstanding balances on home-equity