Words by Smiley Team
Banking is one of those elements of modern life that seem so essential you rarely think about it. But where you keep your money matters. It could mean the difference between financing anti-democratic crackdowns and environmental devastation, or social progress and the transition to renewable energies.
Increasingly, people are switching to more ethical and environmentally-friendly banking options, supported by organisations like Switch It, which offers a tool to discover whether your bank is harming or helping the planet and people. The positive news is that there is plenty of banking options to ensure your money is invested in the pursuit of a better world. Here is our list of top alternative ways to invest positively in the UK.
Founded in 1980, Triodos aims to support the climate and communities. Rather than investing in fossil fuels and damaging industries, their clients’ money goes towards causes such as promoting organic food, green energy and assistance for vulnerable communities. They offer current accounts, saving accounts and investing options.
As one of the more prominent challenger banks, Starling, like Monzo, is disrupting highstreet banks such as HSBC, Lloyds and Barclays. Like Triodos, they refuse to invest in harmful industries and have a significantly lower carbon footprint. Furthermore, it offers one of the most popular app-based alternatives to standard banking in the UK.
For saving accounts and loans, the Charity Bank is a great ethical banking option if you want to direct your savings towards helping social enterprises and charities, although they don’t offer current accounts.
Another impactful alternative for saving accounts as well as mortgages is Ecology Building Society. It doesn’t offer current accounts either, but if you store your savings in one of their accounts they will invest it in sustainable housing across the UK.
Nationwide is a more mainstream banking option recommended on Ethical Consumer, The Good Shopping Guide and Good With Money. They offer current accounts as well as saving options.
Arguably the first ethical bank in the UK, the Co-operative Bank supports social causes, environmental wellbeing and the co-operative value of accountability to its customers. During the pandemic, they donated almost £100,000 to community projects and they have remained carbon neutral for over 10 years.
Owner by its users, Engage is a credit union offering a banking option to people who wouldn’t otherwise be able to open a bank account due to homelessness or financial difficulty. Their application process is free of lengthy bureaucracy, credit checks or fees.
The UK’s largest challenger bank, MetroBank frequently partners with charities and is one of the more highly-rated mainstream ethical banking options.
There exists a wide range of saving accounts and ISAs to invest your money in causes for social and environmental good. Among them is The Big Issue Group’s climate fund as well as the saving accounts offered by Triodos, Ecology Building Society, or Starling Bank.
Rather than storing your money in a traditional bank, you can also opt for a building society, for which profits support the business itself, benefiting the lender and borrower. Building societies are owned and run by their members and usually offer competitive interest rates. Likewise, credit unions are owned and run by members and investments are less likely to fund damaging industries.
