A new debit card has launched with a Christmas campaign promising to donate to a food redistribution charity backed by England footballer and free school meals campaigner Marcus Rashford.
The bright pink Ziglu debit Mastercard makes an automatic 25p donation to hunger charity FareShare every time users shop at a participating supermarket using the card, with the money going towards transforming surplus food into meals for those most in need.
The Ziglu debit card is free to use and regulated by the Financial Conduct Authority – but it’s not a conventional current account for your money. This is Money takes a look.
The England footballer Marcus Rashford is an ambassador for the charity FareShare
Instead, Ziglu is an e-money provider which specilises in enabling customers to buy and sell cryptocurrencies such as Bitcoin through its app.
Users transfer funds from an ordinary bank account and can then apply for the debit card which can be used like any other Mastercard.
‘The Coronavirus crisis has shone a light on hunger and poverty in the UK with more than 8.2 million people struggling to afford to eat,’ said Mark Hipperson, founder and chief executive of Ziglu.
‘Instead of advertising our card launch we are using those funds to donate the price of a meal every time one of our customers uses their Ziglu card at a supermarket.’
The average cost of a meal distributed by Fareshare is 23p and Ziglu has committed enough money to enable up to 60,000 meals to be funded by its customers spending on the card over Christmas.
Marcus Rashford, pictured: FareShare warns more than 1.7 million children will be living in food poverty this Christmas
FareShare warns more than 1.7 million children will be living in food poverty this Christmas, but just £10 provides food for 24 meals at a community café.
‘We’re delighted to receive the support of Ziglu through a scheme that triggers a donation when customers shop at key food retailers,’ said Alyson Walsh, commercial director at FareShare.
‘The combined impact of Ziglu and its customers will help us to unlock more surplus food and provide thousands of nutritious meals across the UK in these increasingly difficult times.’
What is Ziglu offering?
Ziglu is an e-money institution – not a bank
First things first, Ziglu is an e-money institution – not a bank. That means you have different protections under UK law.
Although Ziglu is authorised to handle money, transactions and currency exchanges, your money is not covered by the Financial Services Compensation Scheme deposit guarantee which protects up to £85,000 per customer in the event of a company’s insolvency.
Instead, as an e-money Institution, Ziglu safeguards its customers’ money in a dedicated bank account held separately from its own funds.
Ziglu also states that its customers’ crypto assets are insured against cyber-attacks, up to the value of £50,000.
There are no fees for opening a Ziglu account, you simply download from the app store or google play store on your mobile phone and open an account.
Ziglu claims that in most cases it can verify your details automatically and this should take no longer than five minutes; thereafter a card will be posted to you.
Ziglu’s pink Mastercard debit card charges a 1.25 per cent fee for crypto transactions.
You can use the card for free anywhere in the world although the FareShare donations will only apply to UK supermarkets with the campaign ending on 31 December.
Those interested in the cryptocurrency offering should note that Ziglu charges a 1.25 per cent fee for crypto transactions, which displays in the app prior to confirming your purchase.
This looks reasonable compared to Revolut, which charges a 2.5 per cent fee for standard users and 1.5 per cent for its premium and metal users when trading crypto currencies.
Plutus, another provider, does not charge a transaction fee but levies a 3 per cent charge on every cryptocurrency deposit made using its app.
Rachel Springall, finance expert at Moneyfacts said: ‘Ziglu’s collaboration with FareShare is a great initiative but consumers would be wise to consider the workings of the offer and how this compares to other alternatives.’
Should you donate independently?
While credit and debit cards that automate charity donations offer a hassle-free way to give, Springall believes consumers would have more control donating to charity directly and switching to a current account or credit card that offers cash back or an upfront cash reward.
Food redistribution charity FareShare is backed by England footballer and free school meals campaigner Marcus Rashford, pictured
She said: ‘Savvy consumers will want their cash to work harder for them this year and if they have some spare, they may well want to support a charity with a donation in light of the impact of Coronavirus.’
One alternative for consumers could be to switch current account and take advantage of a cash incentive and then donate to a charity of their choice.
If you know someone with a Metro Bank current account, they can refer you and once you have switched you both receive £50.
Another option could be to apply for a credit card that offers cashback when you spend.
The Amex platinum everyday credit card is a leading fee-free card, which could come in particularly handy if you still have all your Christmas shopping to accomplish.
It offers 5 per cent back on the first £2,000 you spend within the first three months up to a maximum of £100 and up to 1 per cent cash back on all spending thereafter.
As always, spending on a credit card comes with risk and it’s generally not advisable unless you’re able to pay off the balance in full every month. Otherwise, expensive debts can rack up.
Alternative cards that donate to charity
The Ziglu campaign with FareShare is an interesting example of financial institutions becoming more focused on environmental, social and governance standards.
While this is big business in the investing world, more everyday financial products haven’t been so quick to combine ethical offerings with financial ones.
There is the odd one though.
Starling Bank recently launched a new environmental initiative to plant one tree for every successful new customer referral and Revolut enables its customers to send their spare change to selected charities.
‘It’s easier now than it ever has been to align your lifestyle with your values, whether that’s with reduced plastic use, socially responsible investing, using clean energy or donating to charities with your spending,’ said Zoe Stabler, banking and investments writer at Finder.
‘It’s so great to see that as people become more environmentally and socially conscious, there are products being created that are helping them to make a change in the world.’
An alternative option for Britons looking to donate to charities automatically triggered by spending is through credit cards designed to support specific causes.
The Breakthrough Breast Cancer Card, powered by MBNA, will make a £40 donation to Breakthrough Breast Cancer when ordered online and following that, 25p for every £100 spent will go towards the charity.
The Shelter Credit card donates to the homeless charity each time you spend. When you use it for the first time, the Co-Operative Bank will donate £20 direct to Shelter and thereafter the charity receives 25p for every £100 you spend.
Best buy savings rates
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Over the past few years a number of savings platforms have launched, offering savers the option to switch as and when better deals become available. They each work slightly differently and include their own exclusives. To check out what’s on offer take a look yourself.
Or you can view This is Money’s comprehensive best buy savings tables here, independently curated by savings guru Sylvia Morris.