For Good Causes aims to create a brand-new income scheme for the third sector.

Shoppers will be able to convert their unused loyalty points into charity donations thanks to an innovative new scheme launched today.

For Good Causes (FGC) aims to create a brand-new income stream for UK charities by giving people the opportunity to transform points accrued on loyalty cards into cash donations.

FGC say that the average UK adult has around six loyalty cards, with the total value of unused rewards amounting to over £7bn.

By uniting major high street brands with more than 20,000 charities around the UK, FGC hopes that this money can be used to support good causes instead of sitting unused in customer accounts.

A pilot version of the scheme saw thousands of Vodafone customers donate an average of £6.49 each over a month, with 850 charities benefiting from the extra funds.

Other brands that have signed up with FGC include BP, Koin Rewards, Quidco and Rakuten, which operates rewards schemes with Morrisons, B&Q, and House of Frasers. Charity partners participating in the launch include Macmillan Cancer Support, The Trussell Trust and NHS Charities Together.

Wendy Martin, FGC chief marketing officer, said: “We’re on a mission to raise £500m for UK charities over the next five years.

“By empowering consumers to donate their rewards to their favourite causes, we’re enabling charities of all sizes – big and small, national and local – to benefit from this brand-new income stream.”

Macmillan Cancer Support’s Oliver Lashbrook added: "Macmillan is funded almost entirely from voluntary donations. That’s why we are excited to have partnered up with For Good Causes.

“With this new way of giving, Macmillan will be able to continue being there for people living with cancer when they need us most."