Guest blogger Joe Waters, of Selfish Giving, thinks banking for good might just be an idea that takes off.
When a reporter asked the legendary bank robber Willie Sutton why he robbed banks, he had a simple answer: "That's where the money is." The same could be said for why people put their money in banks in the first place, and why banks rake in billions of dollars in deposits every year.
But what if people were motivated to deposit their money for another reason - the same one that motivated them to buy sneakers from Tom's Shoes, salad dressing from Newman's Own, and chewing gum from Project 7. The desire would be to help good causes, and the banking equivalent of these social enterprises is Boston-based ableBanking .
The brainchild of several executives from the Massachusetts banking industry, ableBanking has opened its vaults to depositors who care as much about making a difference as they do earning a good interest rate on their savings.
ableBanking's savings program for a cause is the first of its kind.
Interest rates for savings and CD's at ableBanking are higher than traditional banks and rival other online savings programs at Ally and ING. But after customers set up an account with ableBanking they get a free $25 to give to any 501c3 nonprofit, plus an additional $2.50 annually on every $1,000 they keep on-account.
The potential for donors and nonprofits is huge, as ableBanking is proposing to give away ten to twelve times more than what the average bank currently gives to causes. And unlike traditional banks, ableBanking isn't charging their customers additional fees or spending millions on advertising.
"We are taking the most of our marketing dollars and putting them back into the community," said Heather Campion, Chief Adminstrative Officer & Co-Founder of the new platform.
ableBanking is letting customers choose which cause they want to support. This is also a departure from the practices of traditional banks that generally hand out the donations to the pet causes of top executives and big clients.
"Customers know their communities best," added Campion. "We believe they should be able to choose where they want to make a difference, and we're giving them the dollars to do that."
A good works bank such as ableBanking is an important addition to the league of socially minded businesses. But that doesn't mean they'll be the Tom's Shoes of banking. Sure, Tom's Shoes has captured the imagination of do-gooders everywhere, but cause businesses often lose traction as interests change and consumers return to a business first mindset.
Causeon tried to be the Groupon of causes but failed. CauseWorld was the Foursquare of cause-related location services but didn't check-in with users. Even high profile cause businesses such as Edun , which was founded by U2's Bono and wife Ali Hewson, faltered when shoppers passed on helping Africans when the clothes they made didn't meet expectations.
"We focused too much on the mission in the beginning, " explained Hewson to the Wall Street Journal in 2010. "It's the clothes, it's the product. It's a fashion company. That needs to be first and foremost."
First and foremost for ableBanking is to offer great interest rates. Like Willie Horton said, banks are where the money is. That will always come first.
Read more about cause marketing:
- Five Best Cause Marketing Programs for Local Nonprofits
- 3 Ways to Promote Your Cause Marketing Program
- Find the Perfect Business Partner For Your Cause Marketing Promotion
- 5 Proven Ways to Close a Cause Marketing Partnership
Images: Joe Waters; screenshot of ableBanking website