While reducing your individual carbon footprint is important, the reality is that all industries need to be held accountable. This is where you can let your money do the talking. By working with a bank committed to clean energy projects, you can help show the big guys that sustainability can also be profitable.
In this post, I’ll talk all about green, sustainable banking and how it works. I’ll also cover some of the top green banks operating right now, so you can make the call if one is right for you.
What Is Green Banking?
So, what makes a bank green? To qualify, a financial institution needs to meet certain requirements like focusing on renewable energy.
Though there isn’t an ironclad definition of a green bank, a good benchmark is if an institution is a certified B Corporation, or B Corp. B Corps are organizations that voluntarily meet the highest possible social and environmental performance standards.
Of course, this immediately crosses a lot of options off the list. While green investments are becoming more common, most institutions do not qualify as truly green banks.
That said, the options are out there. If combating climate change is important to you, you can do your banking with an institution that aligns with those values.
Why Is Green Banking Important?
In general, financial institutions don’t have the best track record when it comes to climate change. This is because all of the biggest banks, without exception, have their hands in the global oil industry. This means that you’re indirectly supporting fossil fuel projects every time you make a deposit.
Green banking is important for the same reason that recycling and electric vehicles are important: Climate change is real, and it’s up to us to do something about it.
Since the Paris Agreement was signed in 2016, the 60 largest banks in the world have invested nearly $4 trillion in fossil fuels. The Big Four American banks (JPMorgan Chase, Bank of America, Citibank, and Wells Fargo), which account for nearly half of all American deposits, are among the biggest investors.
By challenging these banks and their gas-guzzling practices, you can help set a new precedent of expectations. Banks, like any big business, always follow the money. If enough people take a stand and say no to banks that fund oil, they’ll have no choice but to change for the better.
And the best part? When you choose a green bank, you won’t compromise on features. While green banks can’t match a big bank’s sheer volume of physical branches, you might find that the online functionality and interest rates are actually better.
Top 4 Green Banks
Here’s an in-depth look at five green banks aiming to work for the planet, while still working well for their customers.
Aspiration
Aspiration is possibly the most well-known green bank in the industry. It’s an online bank, so it doesn’t offer physical branches. Instead, you can handle all your banking needs on the website or app.
Aspiration’s entire platform is built around energy efficiency. It’s pretty simple with an Aspiration account: Climate and customers come first, then profit. As an Aspiration customer, you can rest assured that your money goes toward green energy investments.
Aspiration’s Green Practices
Aspiration is built around the idea of doing well while doing good. It’s committed to donating 10% of all profits to non-profit organizations and never contributes to pipelines or other oil initiatives.
On top of that, Aspiration is doing its part to help with reforestation. When you sign up for its Plant My Change feature, all of your round-ups go toward planting new trees. To date, it has planted nearly 50 million trees worldwide.
Aspiration also helps customers to offset their personal carbon emissions. For example, it claims that every $1,000 you transfer from a big bank to your Aspiration account is equivalent to driving 6,000 fewer miles in a standard car. Plus, with Aspiration’s Personal Impact Score, you can track how green your spending really is.
Top Aspiration Products
Fortunately, Aspiration also comes to play with some super impressive accounts. This is the “Do Well” side of things, and you can expect to grow your money while helping the planet.
Aspiration offers two all-in-one deposit accounts: Aspiration Spend & Save and Aspiration Plus. Both accounts come with early direct deposit, 55,000 free ATMs, and a minimum deposit requirement of just $10 to open.
Spend & Save is a completely free account, though you can opt to pay a fee of your choice if you want to support Aspiration’s mission. Aspiration Plus has a $7.99 monthly fee (or $5.99 per month if you pay annually).
Plus, Aspiration offers a credit card called Zero. It has a $60 annual fee, but you get a $300 bonus if you spend at least $3,000 in your first three months. You can also earn up to 1% cash back with every swipe.
Top Aspiration Features
- Up to 5.00% APY (up to $10,000)
- Up to 10% cash back on conscience coalition debit purchases
- Early direct deposit (up to two days)
- 55,000 free ATMs
- One out of network ATM fee reimbursement per month
- Highly-rated mobile app
Spring Bank
Spring Bank is a New York-based B Corp bank. With an emphasis on community development and climate-focused investing, Spring Bank is an excellent alternative for those in the New York City area.
It has two branch locations in the Bronx and Manhattan, giving its customers the feel of traditional banking while striving to do things a little better. It offers a full suite of accounts and services, along with
Spring Bank’s Green Practices
Spring Bank is part of the Bank for Good movement. This coalition consists of community development banks, credit unions, and other climate-friendly organizations that invest in their communities rather than fossil fuel.
Since 2019, Spring bank has been completely carbon neutral. The bank has a clear commitment to reductions in emissions, especially through its Green Checking account.
Top Spring Bank Products
Spring Bank offers a variety of products, including a checking account, savings account, personal and small business lending, and banking for non-profits and small businesses.
Its flagship product is Green Checking, an entirely paperless account. It comes with all standard checking features, plus the peace of mind that your money funds positive projects.
Overall, Spring Bank mostly steers clear of traditional banking fees. Some accounts may come with a small monthly maintenance fee, but the minimum balance requirement to avoid them are also low.
Top Spring Bank Features
- Free Citibank and MoneyPass ATMs
- Up to 0.50% APY
- Highly-rated mobile app
- Two in-person branches
Atmos Financial
Atmos is a neobank with a mission to finance a rapid transition to a clean economy. Created with a notion of affecting the status quo positively, Atmos is dedicated to getting as many people involved in this transition as possible.
Atmos was founded in 2020. It’s based in San Francisco and offers digital accounts nationwide. Everything it does is centered around green financial services, and you can apply for an account online in just two minutes.
Atmos Financial’s Green Practices
When you deposit money with Atmos, your money goes toward climate-resilient infrastructure. This includes projects in renewable energy, electric transportation, green construction, and more. You can even see the overall carbon impact of your account balance.
Atmos also makes it simple to support its partnerships with environmental non-profits. You can choose to round off your purchases as donations or set up a recurring monthly contribution to an organization of your choice.
Plus, Atmos can help bolster your wallet when you shop green. When you use your card on hundreds of sustainable products and services, you earn up to 5% cash back.
Top Atmos Products
Atmos offers two online bank accounts: Cash Back Checking and High-Yield Savings. Neither account comes with a minimum balance requirement or a monthly fee, and both allow you to monitor your impact on the clean economy.
Cash Back Checking comes with both physical and digital debit cards, plus fee-free ATM access at more than 55,000 locations. You can also use mobile check deposits, Apple and Google Pay, and earn up to 5% cash back when you shop sustainably.
High-Yield Savings is a fee-free account that comes with an APY of up to 0.80%. The base rate is 0.40%, but if you make a recurring donation to a non-profit, Atmos will double it for you.
Top Atmos Features
- Up to 0.80% APY
- 55,000 free ATMs
- Up to 5% cash back
- Fee-free
Amalgamated Bank
Amalgamated Bank aims to be America’s most socially responsible bank. It’s one of the few unionized banks in the U.S. and the largest union-owned bank. Along with climate change initiatives, Amalgamated is dedicated to supporting social justice and other progressive causes.
The bank is based in New York City and has four branches in New York, California, and Washington, D.C.
Amalgamated’s Green Practices
Amalgamated’s social practices are broad, and it has its hands in several different areas centered on social responsibility. In terms of climate justice, the bank focuses on intersectionality and how the climate crisis affects historically oppressed communities.
Amalgamated is one of just four American banks to join the Net-Zero Banking Alliance, a group consisting of investment banks, lenders, and other institutions aiming for net-zero emissions by 2050.
Amalgamated does not lend to fossil fuel companies and contributes 24% of its loan portfolio to Property Assessed Clean Energy (PACE) financing. It also works directly with the Amalgamated Foundation, which donated $9 million for climate justice in 2020.
Top Amalgamated Products
Amalgamated’s personal banking product portfolio is broad, and it offers four different checking accounts and three savings accounts. It operates as a hybrid bank with both online and traditional accounts available.
Its Online Checking account is fee-free and interest-bearing. It comes with free access to Allpoint ATMs, plus two non-Allpoint reimbursements per month. Amalgamated Online Savings is similarly fee-free and comes with a competitive 0.40% APY.
Top Amalgamated Features
- 0.40% APY
- Four in-person branches
- Fee-free
- Free Allpoint ATMs
- Hybrid banking
Frequently Asked Questions
What is green banking concept?
Simply put, green finance is the practice of consumer and commercial banking that does not negatively impact the environment. Green banks do not work with stakeholders in fossil fuel projects and actively support those trying to curb the effects of climate change.
What banks are Green Banks?
Aside from the five mentioned above, many other green banking providers are in operation. I chose to cover some of the best American green banks, but there are also many of them abroad, such as the Australia Clean Energy Finance Corporation.
If you’re looking around for a green bank, it should be pretty clear whether or not one fits the bill. Banks committed to fighting climate change tend to make it pretty well-known. In general, if a bank doesn’t, it probably isn’t all that green.
Why is green banking important?
Green banking provides the opportunity to fight climate change by opening a new account. When consumers prioritize environmental responsibility over convenience, it sends a message. If that message pops up on a large scale, big banks will inevitably follow suit.
If you want to dive deeper, you should check out the Coalition for Green Capital, an organization dedicated to climate finance around the world.
Should You Consider Green Banking?
Historically, finance and environmental responsibility have rarely gone hand in hand. Banking, as a whole, has gone unchecked with its harmful practices for too long, and the planet has paid for it.
Fortunately, you can do something about it. The choices you make with your money are powerful, and new markets focused on green banking can put it to good use.
Of course, the reality is that we all need a great banking partner that aligns with our goals. The key is to strike a balance between what’s good for your wallet and what’s good for the planet.
Here’s to a brighter future that’s both sustainable and profitable for all bank account holders.
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