Making your money matter: the power of green banking
- Written byNamita Manohar, UAL Climate Advocate
- Published date 05 March 2024
When I discovered green banking through a Carbon Literacy Training session for the UAL Climate Advocates, my first thought was “why haven’t I heard about this sooner?”
Amidst the campaigns around mindful consumption, plant-based eating and using public transport, why did green banking, arguably one of the most powerful climate actions an individual could take, go unnoticed?
As a student, I wanted to know how I could be involved and whether my involvement would even make a difference.
After researching and advocating for green banking over the last couple of years, here are my thoughts on why I think this is a powerful and easy climate action students can take.
First, what is green banking?
“Green banking is a new, sustainable way to bank, that focuses on lowering environmental risks and creating a positive planetary impact, while handling day-to-day banking needs. Green banking does this by investing in renewable energy instead of environmentally harmful industries, providing green loans and reducing carbon footprints.” Source: Algbra Bank
Social impact and ethical investments often go hand-in-hand with environmental objectives and several green banks in the UK also focus on:
- Social Responsibility: through social initiatives such as affordable housing projects, community development, support for small businesses, fostering inclusive and equitable economic growth.
- Transparency and Accountability: by being transparent about their investment practices, allowing customers to make informed choices about where their money is being invested and how it aligns with their values.
Why is green banking important?
Many traditional banks invest in unethical business and trade such as fossil fuels, deforestation, arms, gambling and tobacco. By choosing to switch to a green bank your money could instead go towards ethical investments such as:
- Clean energy
- Human rights
- Health care
- Green transport
- Reforestation
According to Switch It Green, a single student’s switch to a green bank is estimated to withdraw £1.5 million from banks that in some way invest in fossil fuels, regardless of your current bank balance. ‘Switching it green’ is a powerful way for students who care about the climate to align their actions with their values, prompting traditional banks to acknowledge and respond to the growing demand for more ethical investments.
How can you get started with green banking?
Here’s the best part - green banking is super easy, it doesn’t cost a penny, and experts are doing the research and offering support every step of the way!
Step 1 - Check whether your bank is ‘green’. You could do this by critically analysing available information (such as annual reports or the bank’s website), or try these interactive web tools by Bank.Green or Switch It Green to see how your bank fares against their criteria.
Step 2 - If your bank is funding the climate crisis, make the switch to a green bank that passes the criteria. This involves closing your old account and moving your funds to your new account - an experience made seamless with the Switch Guarantee, a feature available for most UK banks.
Step 3 - Maximize your Impact! Spread the word and share your new-found knowledge. Switch It Green has built a user-friendly dashboard that you can use to explore various tools with ready to use templates to maximize the impact of your switch.
Sources:
What is green banking and why does it matter? Algra Bank
Tridos Bank Annual Report
Cooperative Bank Sustainability Report 2022
Switch It Green UK
Make my money matter