The aim of ethical banking is to make a positive social and/or ecological impact on the world. Today, many people are looking for more in their banks than just high interest rates. There are a number of different projects that your money can go into besides investments. Not only can you buy stock in ethical companies but mortgages, savings and retirement funds can also be purchased ethically.
For example, Co-op Bank has a wide range of ethical banking products on offer and promises to not loan money to weapon manufacturing companies or companies who endorse child labour. The Ecological Building Society only lends money to people who are purchasing an energy efficient home or building a new home from sustainable materials. They also give money to people who wish to renovate a derelict building, which most lenders normally shy away from.
HSBC offers customers the choice of paperless money. HSBC green account holders can save £70 with the energy supplier Ecotricity and receive free energy saving light bulbs, as well as 10% off the online eco store, Natural Collection.
It can be hard to believe that changing your banking habits will make an impact on the world. It may not make a difference on an individual basis, but collectively, we could control the money flow from one institution to another, supporting those who we believe meet our ethical standards. To give an example of how much money individuals of the UK control, here are some statistics:
- The UK investment industry looks after £2,800 billion of our money.
- According to the Council of Mortgage Lenders, home load statistics show that the UK's population owes £1000 million, a number that has doubled in the past six years.
- A count conducted in 2004 shows there are 190 million plastic cards in the UK. That's about four cards per adult.
- Tens of millions of people in the UK have money invested in a pension scheme.
Not only could we make a difference in billions of peoples lives by switching our banking habits, but we would also stop dislocating our view of the world from the way our money is used.
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This post was written by Christine Pinella on May 22, 2008