Most people are pretty consumer-conscious when it comes to making greener buying decisions, but forget to put their money away in a bank that holds their same values. While the concept of green banking may be foreign to some, if you care about spending your money on sustainable goods and services, you should also be aware of green choices when it comes to storing your money.
Green banking and green investing can bring your sustainability game to a whole new level. I’m sure both your financial game and your personal sustainability game are great, but what if you brought them both together? You may already know about great trading apps and the best stock pickers, but what do you know about green banking and sustainable investment? Read more to find out!
How Do Banks Work?
If you lived through the “too big to fail” era of bank bailouts, you know that banks wield an enormous amount of power over society. How does any entity grow so large as to warrant massive government bailouts?
In the economy, there is no fixed amount of money. There is no authority saying there needs to be any particular amount of money in any particular place. Banks are one of the few entities that are allowed to create capital. The vast majority of money isn’t even in the printed paper– most capital is created by banks when they issue loans. Bear in mind the biggest loans aren’t colleges or mortgages, the biggest loans are business loans.
For this reason, commercial interest is the driving force behind the creation of money in society, and not social need. You are probably well aware of how the distribution of wealth equates to the distribution of power. More money means more power, and control over the money supply is control over society’s power. It’s time to take the power back.
Why Are Regular Banks Not Sustainable?
When you put your money into a bank, it doesn’t just sit there in a vault waiting for you. Banks take your money and invest it, with a guarantee you will be able to access the amount you put in when you need it.
So what industries do banks invest in? Many, but some of their big cash cows are fossil fuel and oil companies. While you personally may never support these companies, banks are often not transparent with customers about how funds are invested.
So if you’re really invested in going green: don’t let banks undermine your values with the way they invest your money.
How Can Banks Be Green?
It’s clear that a sustainable global economy needs a transparent banking system. Our economic system must be revised to prioritize ecological sustainability, social justice, and financial stability for the younger generations.
This occurs on a commercial and personal level. I’m sure you know plenty about personal sustainability. It is important as individuals to slow our rate of consumption and aim towards zero waste, but we also need to be holding banks accountable to uphold our values as citizens, not just the values of its largest shareholders.
The answer is clear: in order to fully go green, you have to put your greenbacks towards it.
Opening A Green Bank Account
So which banks are open and transparent about their investments? Usually none of the big ones. Big banks are notorious for being opaque with investments and have a bad track record when it comes to supporting ecology-destroying industries.
Fortunately, there are plenty of alternatives. If you peruse the Green Bank Network you can find a service that aligns with your personal values. Do a little research and find a bank that supports causes that you also support.
A popular option for those who want their money to go towards social justice and societal betterment, The Charity Bank ensures that money put in by customers goes towards social enterprises. If you’re concerned with giving back, The Charity Bank is a great choice to store your money.
Another great option for those hoping to use their investments to help the environment is Climate First Bank. The Climate First Bank focuses its investments towards people, planet, and prosperity.
There are even more great options for green investments, do some research and find one that’s perfect for you!
Sustainable Savings, Loans and Mortgages
This is where even the most ecologically-minded of us accidentally end up supporting oil companies. A lot of regular savings accounts are based on the Financial Times Stock Exchange 100, otherwise known as FTSE 100, or the “footsie.” These are the 100 companies listed with the highest market capitalization, and unsurprisingly this involves a lot of fossil fuel companies and other big-time polluters. Fortunately, these days there are plenty of alternatives that are comparable to or outperforming the FTSE.
Again, do some research. Look into Mutual, local Building Societies, and Co-Ops. Look for organizations that are run by their members. This way instead of the interest on money going towards some bank branch manager’s bonus, the money goes to other members of the community with whom you share a bank.
These organizations are owned by their members, who subscribe to a common fund. So, rather than the interest you pay going towards your bank manager’s bonus, it’ll be going back to other members of the public who share your bank. It’s a great way to keep currency flowing in a community, instead of funneling it out.
You may know everything about going zero waste, ethical consumption, and going green, but unless your banking is green your efforts are being constantly undermined. If you’re serious about sustainable living, don’t just stop at your own lifestyle. Demand structural change by moving your money into funds that better society and the planet, not just the top shareholders at the bank. We are the economy- let’s take our power back and demand a better future. Don’t hesitate, do some research and start investing green today!