Is it possible for banking to be ethical?

I had no idea such a thing as ethical banking existed. I thought banks were; reckless, irresponsible, did not fit my values, caused the global financial crash, funded unsustainable industries and paid their top employees huge amounts of money.

Cartoon banking infographic asking What does your bank do with your money? Maybe, it's time to ask.
I love this infographic from Triodos

Then I discovered Triodos, through my reliable friend Ethical Consumer Magazine. A Dutch bank with a difference (now with a UK arm to cope with Brexit).

  • Only finances companies that focus on people, environment or culture. 
  • Are transparent about who they are lending money too.
  • The products aim to be among the best in the banking sector.
  • Working to develop innovative ways to finance sustainable entrepreneurs, companies and initiatives.

Model, and actress, Lily Cole does a great job of summarising why they are different in this short video.

A new player in current accounts

Whilst they have always offered ISA’s, investments and business lending, they have recently added current accounts.

This appealed to me and Mr LGD because;

  • We didn’t want our money lent to arms companies, factory farming, industrial agriculture, the fossil fuel industry and companies we boycott in our day to day lives.
  • Seeing the organisations our bank is lending money too is important to us. 
  • We want our money to help with positive environmental and social change.
Triodos Bank Card with the text "Unveiling the Triodos Current Account everyday banking with values"

It does cost £3 per month for the account. This is radical in the UK where current accounts are traditionally “free”.

It turns out current accounts are not free at all. The back end costs of running current accounts, the mobile app, online system etc are covered at most banks by hidden costs and high overdraft charges. These are often footed by those more vulnerable in our society. Triodos wants to be upfront about the true cost of banking and spread that cost between everyone more equally.

Switching was very easy. The current account switching service enabled complete control over what happened when. Triodos organise everything, if anything was to go wrong (it didn’t) it is guaranteed.

Our financial system

As noted in this informative and inspiring talk at the Triodos Annual Meeting in 2017…

  • We created the financial system so we can change it!
  • The financial system should service all people and planet not just a few people.
  • The financial system should be fair.
  • What we do with our money matters.
  • Finance is currently the least trusted segment of the global economy.

Banking in the rest of the world

This new kind of banking is not just a European phenomenon. The Global Alliance for Banking on Values (GABV) is a global alliance of ethical banks. It has 36 members equating to 24 million customers and £8.7 billion!

Finally

One of my favourite things about Triodos is to see the kind of projects my money is supporting. The regular Colour of Money magazine gives an overview of some of the newest ones. But I can also see on the web site projects they are supporting in a specific sector or region.

It is so empowering for me to know that my money does make a difference. Even in something as essential as banking I can vote with my money for the kind of world I want to see.

We all have much more power than we think, we just have to take it. 

Disclaimer

I have a current account and investments with Triodos. However I have not been asked to write this article, and have not received anything for doing so. All opinions my own. This article is my personal opinion and should not be considered financial advice.