Ethical Banking: The top 5 reasons why should you switch

Banks are a global power and have a profound effect on society, but what does banking have to do with the environment? Many aren’t aware of the connection between the economy and the planet, yet where we store our money and who we bank with has an immediate effect on the environmental crisis that affects the world today. Global banks have failed to take responsibility and have fuelled the irresponsibility of big corporations – their reputation for using unethical environmental practices don’t stop at banks. So, why should you stop, consider, and make the switch to ethical banking? Read on to find out.

ethical banking supports green initiatives
credit: Michell Unsplash

Traditional banking can re-invest our money into unethical industries

As stated, banks hold a lot of power and have great influence over society, and when people open accounts with these providers, they can re-invest our funds in unethical industries like the fossil fuel industries. Although your money may be used to purchase eco-friendly products and shop at sustainable stores, your bank may not match up what they do with money stored with them with your green ethics and values. These banks funnel trillions of dollars into fossil fuels and therefore encourage the climate crisis and ignore the terms of the Paris agreement.

Traditional banking can support the destruction of the environment

Many traditional banks support destructive practices because they benefit from them – a selfish feat that further exposes the questionable ethics of big banks. Large agriculture companies that promote unethical farming, GMOs, pesticides, and extractive industries involved with oil, mining, and gas are often supported. An article posted by The Guardian showed that an analysis of 35 leading investment banks financed more than $2.66 trillion for fossil fuel industries since November 2016.

ethical banking supports worldwide initiatives
credit: Jason Leung

Ethical banking cares about good causes

Compared to most traditional banks, ethical banks will always choose organizations that are committed to making a positive impact on the environment. Sustainable investment for them involves avoiding all those harmful industries and moving toward renewable energy, social justice, global equality organizations, and more. Some of these banks even lend to volunteer groups, charities, and Fairtrade businesses with the aim to make the world a better place.

Ethical banking benefits green businesses and projects

Green businesses and projects often clash with traditional banking economies. Green banks gather funds from many sources and aggregate them in one place so that business owners don’t need to collect funding themselves from several sources. They provide an easier way for these green businesses to operate, for example, offering credit for installation and upgrades for an energy-efficient building or offering clean energy assessments. Aggregating funds in this way helps businesses grow and learn about eco-friendly practices.

Ethical banking follows environmentally friendly practices

Green banks take on environmentally friendly practices in their work, considering how their products, services, and business-related initiatives affect the environment and their goals relating to sustainability. This could include offering online rather than paper statements and many other electronic banking options, providing energy-wise ATMs, providing green financing solutions, and taking a lot of corporate responsibility. This transparent approach supports a fair and sustainable economy, rather than one which disconnects from our ecological responsibilities.

ethical banking can support all your needs
credit: pexels

Our recommended ethical banks worldwide include:

Bank Australia

Bank Australia is a fan of prosperity – but only when it makes a positive difference socially, environmentally and culturally. They launched their Clean Money campaign in 2018, which prioritizes lending to renewable energy, not-for-profits and sustainable and affordable housing. Bank with them if you don’t want your money loaned to unethical industries.

Co-operative Bank UK

Co-operative bank is well-known for abiding by an ethical policy that is internally audited each year. They offer a current account with many perks and an Everyday Rewards Scheme where you can donate your up to £5.50 a month to any charity of your choosing. Bank with Cooperative if you’re interested in a bank that follows ethical policies.

Triodos (Europe/Netherlands)

Triodos has a green account that coincides with their values, offering a contactless card made of natural plastic and lending your money to organizations that make a positive environmental impact. Open an account with Triodos if you want your money to make a difference.

Banca Etica (Italy/Spain)

Banca Etica has roots in responsibility. Whether it is financial resources, socio-economic causes, or sustainability, the bank focuses on financing positive organizations and works with green energy and organic food. Bank with them if you’re looking for a bank aware of the noneconomic consequences of their actions.

Cultura Bank (Norway)

Cultura Bank’s priorities include infusing their social and ethical values into every aspect of their business. They primarily support organic agriculture, education, and healthcare. Bank with Cultura if you’re looking for an eco-friendly banking experience that uses its assets on ethical investments.

Amalgamated Bank (USA)

Amalgamated Bank takes action. With their social responsibility attached to their policies, operations, and products, they heavily consider the environment and have endorsed the United Nations’ Principles for Responsible Banking. Open an account here if social responsibility is a priority to you.

Leave a Reply

Your email address will not be published. Required fields are marked *

Your Pre-Trip Sustainability Checklist