Environmental protection concept representing sustainable payment cards, Circuit board with green leaf, close-up view
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Greener bank cards can help sustainability push

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6 Mins.

The financial services industry is making a concerted effort to adopt more sustainable practices, but more concrete action needs to be taken if banks are to play a role in combatting climate change and improving trust among customers

It has been five years since the United Nations launched its 17 sustainable development goals (SDGs), with the aim of providing a blueprint for a more sustainable future by 2030. In common with businesses in other sectors, many banks promised to take action in a range of areas, from reducing poverty to improving gender equality. Netherlands-based ING, for example, promised to focus on promoting climate action, sustainable consumption and production, and sustainable and inclusive economic growth.

In September 2019 a number of banks went further, agreeing to adopt new UN-backed climate and sustainability principles. The signatories to The Principles for Responsible Banking, which has grown to 199 financial institutions worth $53 trillion, committed to strategically aligning their businesses with the goals of the Paris Agreement on Climate Change alongside the UN SDGs.1

Insufficient progress

So, how are things progressing? According to UN Secretary-General António Guterres, “global efforts to date have been insufficient to deliver the change we need, jeopardizing the [Sustainable Development] Agenda’s promise to current and future generations.”2 Redoubling efforts to ensure change does happen is particularly important in light of the COVID-19 pandemic, Guterres noted. 

“Global efforts to date have been insufficient to deliver the change we need“
UN Secretary-General António Guterres

Given the vast scale and ambition of the SDGs, it can be difficult to know where to start, but opportunities do exist to make a positive contribution. Take payment card issuance programs as an example. There are around 20 billion payment cards in circulation worldwide, many of which are made from a type of plastic called PVC, due to its durability and cost-effectiveness. Although lightweight, these credit, debit, and prepaid cards do contribute to the roughly 400 million tons of plastic the world currently produces every year.3 Worryingly, it is estimated that just 9% of this plastic is recycled, meaning that the remainder is sent to landfill, burned, or discarded, thereby polluting the planet.4

Going Beyond plastic

Close-up of a woman lying in the grass using sustainable bank cards online
Banks are starting to launch sustainable payment cards to meet customers' social and environmental concerns

There is a different way. By working with partners in finance and beyond, banks can reduce plastic production and recycle more of what needs to be produced. Global technology leader G+D has teamed up with Parley for the Oceans – a New York–based movement committed to protecting the world’s oceans – to produce an eco-innovative material for payment cards. The two organizations want their collaboration to represent a symbol of change that allows financial institutions to engage with their card members and become part of the environmental movement.

The Convego® Parley Ocean card, for example, is made from 100% recycled plastics, 90% of which has been sourced from plastics found in oceans and coastal regions. It is part of G+D’s Convego Beyond portfolio, which features a range of solutions for the entire card issuance life cycle, from sustainable card materials and packaging to digital alternatives that negate the need for plastic and other environmentally unfriendly materials.

A number of banks are already launching sustainable payments cards, with those in the UK taking a lead. Triodos Bank customers have been using a debit card made from a bio-plastic substitute called polylactic acid (PLA) since 2018. PLA is created from renewable sources, such as plant leaves and corn, rather than petroleum, and is  compostable, and non-toxic if incinerated. Nationwide Building Society, which issues 5.4 million debit and credit cards annually, has said customers will be able to use a card made from recycled PVC materials early next year.

A business imperative

Moving to payment cards that are more environmentally friendly is important not only for banks looking to meet their SDG-related obligations – they are a business imperative too. Although trust in banks and financial services companies rose in the first five months of 2020, these organizations are still towards the bottom of the “Edelman Trust Barometer,” a ranking that compares how consumers of all ages around the world trust different sectors.5

One of the most important demographics that banks need to ensure trusts them is Generation Z. Given that Gen Zs were born from the mid-1990s onwards, they are now entering the workforce, and for banks they represent the bulk of their immediate and future customers. According to one recent study, 90% of Gen Z believes companies must act to help social and environmental issues, and 75% will do research to see if a company is being honest when it takes a stand on issues.6 It is clear that banks need to evolve to remain relevant. As competition from new, digital-first players intensifies, it is no longer a question of whether it is necessary to act, but of how to act. Embracing green payment cards and associated issuance processes is one way banks can start walking the walk on sustainability issues.

  1. “Principles for Responsible Banking,” UNEP Finance Initiative, 2020

  2. “The Sustainable Development Goals Report 2020,” UN, 2020

  3. “FAQs on Plastics,” Our World in Data, 2018

  4. “A Whopping 91% of Plastic Isn’t Recycled,” National Geographic, 2019

  5. “2020 Edelman Trust Barometer,” Edelman, 2020

  6. “2019 Porter Novelli/Cone Gen Z Purpose Study,” Cone Communications, 2019
     

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