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April 29, 2011

The Three Cups of Tea Scandal: Opportunity for Banks and Credit Unions

In this post, Brenda Haines brainstorms a way to integrate charitable ratings data with bank accounts to add value for customers …

The scandal surrounding ‘Three Cups of Tea’ may actually present an opportunity for banks and credit unions.

Brenda HainesIn case you are unfamiliar, the book ‘Three Cups of Tea’ profiles climber Greg Mortensen’s failed attempt to climb K2. According to his website, the book explains how he became disoriented, wandered away from his group and ended up recovering in a village in northern Pakistan. There, the website says, he noticed the village did not have a school and could not afford the salary of a teacher. That inspired him, according to the website, to make a pledge to go back home and raise money to build the village a school. (Read the entire story.)

It had become one of the most inspirational stories in recent memory.

Then, CBS’s 60 Minutes did a story last week questioning the book and Mortensen’s charity, the Central Asia Institute, particularly the proportion of spending that has been devoted to building schools in the developing world vs. conducting outreach here at home.

Earlier this week, Mary Pilon wrote a thought-provoking post called “Lessons for Donors from ‘Three Cups of Tea” on the Wall Street Journal website. In it, she profiles several online charity ratings services, including Better Business Bureau’s Wise Giving Alliance, CharityNavigator.org, GreatNonprofits.org and Guidestar.org and describes how each rated the Central Asia Institute before and after the scandal broke. According to Pilon’s post, only the Better Business Bureau’s Wise Giving Alliance raised a red flag, placing the charity in “nondisclosure” status for failing to respond to requests for financial reports over the last three years.

How does all of this tie to banks and credit unions?

What if financial institutions could help their customers and members understand a charity’s ranking? Perhaps data like that from the Better Business Bureau could be integrated with a payment processing system so that when a donation is entered, a bank customer or credit union member could receive an alert containing the charity’s rating. Ratings below a certain threshold – established by the user – would put a payment on hold. Users could choose to override the payment, if they had reason to believe it was inaccurate or unfair.

What do you think? Would a service like that add value for bank and credit union customers? As a customer or member, is that a service you would use?

I’d love to hear your thoughts.
– Brenda

Disclosure: I serve on the board of a credit union.