From cutting back on the amount of plastic to reducing carbon footprint globally, there’s been a fundamental shift towards more green-conscious habits in many parts of society writes Howard Berg
Today’s consumers are increasingly choosing brands that use sustainable materials and offer ethically manufactured goods. In fact, according to a study by Nielsen, 66% of global consumers are willing to pay more for sustainable goods and 81% of people believe that businesses have a responsibility to help protect the environment.
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These sustainability-conscious consumers are having an increasing impact on businesses. During the past few years there has been an incredible focus on the harm of single use plastic such as bags and straws on the environment, but what about the plastic in our wallets? According to the UK Card Association, there are over 164 million payment cards in circulation in the UK.
The vast majority of these are made from non-biodegradable plastic such as polyvinyl chloride (PVC), which contributes to harmful landfill waste. And with debit card payments being the most popular way to pay in the UK, it’s essential that the cards that we use are environmentally-friendly.
So how can banks address this challenge and develop a card lifecycle strategy that encourages sustainable banking?
As a starting point, banks should develop a sustainable card lifecycle strategy which is based on sustainable technology, processes and products which can deliver a substantial reduction of carbon footprint. There are four key steps in which banks can achieve this.
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By GlobalDataMove from paper to digital
The first step is introducing processes that accelerate dematerialisation. This includes reducing the excessive and unnecessary volume of printed documents such as personalised card carriers, inserts and PIN mailers as well as paper products associated with delivering and activating cards, sharing information with cardholders and providing issuers with reporting solutions.
By allowing card holders to use digital technologies to manage their finances, banks and other payment providers are providing a sustainable alternative to paper statements and physical bank branches.
Moving from paper to digital is also critical for more seamless customer experience. Currently, customers need to wait at least 2-3 working days to receive their PIN for their new debit/ credit cards which could cause a lot of friction for the end user. Luckily there are better alternatives today. For instance, a PIN code can be delivered instantaneously via a banking app, banking website or via SMS. This not only provides customers with innovative, more seamless experience, but it also allows banks to reduce their carbon footprint.
Use sustainable materials
From big sports brands like Adidas and Nike using recycled materials in some of their trainers and clothing, to IKEA sourcing 100% of its cotton from farms that meet the Better Cotton standards, companies from different industries are making a step change into adopting more sustainable materials to manufacture their products.
Banks are not an exception. For example, Triodos has been working with Gemalto, a Thales company, to become one of only a few UK banks to provide eco-friendly debit cards, which are created from a plastic substitute called polylactic acid (PLA).
PLA is made from renewable sources such as plant leaves and corn which makes it biodegradable, recyclable and non-toxic if incinerated. The materials make the card compatible with magstripe, contact and dual interface card technologies. Ultimately, working with sustainable materials can have a profound impact on the environment if it is adopted on a large scale.
Choose green suppliers
It’s also important to consider eco-design at every stage of the card-making process, from product conception to re-engineering. This includes the product’s environmental impact such as resource consumption and emissions during manufacturing as well as waste and end-of-life disposal.
But that’s not to say that traditional financial institutions aren’t taking steps to be more sustainable too. Banks, for example, are improving their environmental credentials by setting targets that will help them hit their United Nations Sustainable Development Goals – such as the UN Principles for sustainable banking that will officially launch in September.
We are working with clients to help them achieve these goals by providing a “carbon offset” solution, among other things, which provides financial support to energy-saving and renewable energy programs. The goal is to generate carbon credits to compensate greenhouse gas emissions generated by card production.
Help consumers keep track of their carbon footprint
Similarly, consumers are becoming increasingly open to apps designed to offset their carbon footprint. Although today’s conscious consumers are driven by environmental concerns when making purchases, they often struggle to understand their carbon footprint. Banks and financial services companies can provide a helping hand by giving customers more insight into what effect their spending habits are having on the environment.
For example, Swedish company Doconomy has rolled out a free and easy-to-use mobile banking service that lets users track, understand and reduce their CO2 footprints through carbon offsetting.
The firm’s aim is to inspire a change in behaviour and a reduction in unsustainable consumption and carbon emissions. Doconomy has also worked with Gemalto, a Thales company, to provide customers with an eco-friendly debit card made from a sustainable plastic substitute, which is connected to a mobile app that allows users to measure their carbon footprint from every purchase.
In conclusion…
Advancements in technology and sustainable products have made it possible for banks to offer green alternatives to plastic debit cards and to choose more eco-friendly card lifecycle management strategies. Innovative and evolving financial services are sitting right at the heart of this green evolution, taking advantages of the technologies available to make every aspect of a bank card’s life sustainable. The benefits of adopting a more environmental mindset and a sustainable banking strategy are huge. This helps financial institutions raise their brand profile with consumers and business customers and more importantly, it contributes to lowering carbon emissions and plastic waste.
Howard Berg is SVP & MD Gemalto UK&I, a Thales company
