10% of bank fee to environmental charities


(Miles Winter) #1

This idea came to me while doing some reading about Payment for Ecosystem Services as part of my university course. A bank in Costa Rica, Bank Nacional, offers a ‘green card’ that donates 10% of the bank’s fees to funding environmentally friendly programmes - such as forest replanting, renewable energy infrastructure, protected area funding. As a community minded and progressive bank, I thought I’d float this idea to you. This would give customers the ability to opt in to having a certain type of current account that they then knew was contributing to the green economy - you could even make the card a funky vibrant green in line with your bright branding! Another similar example of this would be Ecosia, the search engine that donates 10% of profits to forest regeneration, so it’s a semi-established business model that I think could work for you. Let me know your thoughts!


#2

Peraonally I dislike any company be it Monzo or Sky TV donating any money to charity. It hits the bottom line and reduces profit. This theoretically means higher interest on overdrafts, higher bank charges or lower savings interest (or in the case of Sky regular customers paying higher costs for their package because they are subsidizing the rainforest or cycling). If you want to give to charity great but don’t make all the other customers bear the burden of supporting causes however laudable.


(Alex Sherwood) #3

I don’t think it’s quite that simple, Sky can only set their prices based on the market (supply & demand etc.) and then once they’ve earnt their profit, the can choose to donate some of it to charity, rather than giving it to shareholders / reinvesting it. Obviously the cycling team is a marketing cost.

But I agree that it would be difficult to find a cause which all Monzo users would agree on. So my preference is for Monzo to make it easy for users to give to causes that they’re passionate about, through features / integrations like this -


(Rika Raybould) #4

As a better alternative, I would actually prefer if banks made efforts to improve their own operational environmental footprints, rather than throwing money and saying it’s all good.

For example, pushing to source their energy from renewable sources, recycling their equipment responsibly, serving food from responsible suppliers at events, pushing card suppliers for recyclable or biodegradable cards, ensuring paper for letters comes from sustainable sources, encouraging cycling, public transport, or EV use among their own staff, etc.

Being good to the planet starts with your own actions, pushing it up the supply chain, and investing in things you can use, not throwing money out in these kinds of ways.


(Miles Winter) #5

A move to donate profits for the sake of a project that is environmentally-friendly could attract more users who buy in to the environmentally-conscious-bank ethos, and thus lead to increased profits long term through an increased customer based. It’s as much a marketing issue as it is a charitable one.

The higher interest on overdrafts, higher bank charges or lower savings interest would only be passed on to customers if Monzo decided to pass it on to customers, rather than taking it from their own profits, which goes against the social responsibility approach that I’m advocating. In this sense, it is the bank bearing the burden, at the choice and direction of its members (since people would opt in to the ‘green card’ bank account), rather than other customers ‘bearing the burden’.

I think this fundamentally comes down to what kind of bank does Monzo want to be? Your arguments about why they shouldn’t give away part of their profits buys in to the culture that is present at many banks to maximise profits. Yet by donating a small portion of their profits to environmental causes this sets Monzo up to be a socially and environmentally responsible bank, which through appropriate marketing strategies is likely to attract attention from a large number of ‘millenials’ for whom the environment is an important topic.


(Miles Winter) #6

I like this suggestion! Though the idea of a ‘green card’ makes more of a statement about the bank and its outlook, as well as allowing customers to express their charity choice through applying for this kind of bank account. Other types of account could still exist, the offer of a ‘green account’ would be alongside the conventional offerings of a current account, savings account etc.


(Miles Winter) #7

Why not both?

Further, a stipulation of opening a ‘green account’ might be that the money in these accounts is only invested into non-environmentally harmful assets, similar to many divestment campaigns


(Rika Raybould) #8

Why not make that part of the bank’s ethics and investment policy, applying that to all accounts opened with Monzo?

These are fantastic ideas but Monzo is in a great situation to think bigger than just offering a specific green account. This is an opportunity to make doing good the standard for the entire bank. To make hot coral the new green!

I just don’t believe that a separate account type is the way to go. It’s my personal opinion that to do real good, you have to push to make it the standard that everybody uses. Separate account types just make people feel better and often don’t receive the number of sign ups required to make them sustainable or do the levels of good they aim for.


(Miles Winter) #9

A very good point. Do you know if this is currently set to be incorporated into the bank’s ethics and investment policy?

And would you support a similar pledge across all accounts to donate part of the profits to good/green causes? In a similar way to Innocent Smoothies or Ecosia


(Rika Raybould) #10

I do not, but now is the time to start asking that it is.

The current ethics policy is a little thin but can be found at monzo.com/ethics.


(Naji Esiri) #11

And we’ll certainly be looking to flesh this out over time! I totally agree with Richard that we have a great opportunity to set an industry standard and apply some ambitious ideas in the realm of sustainable practices (ideas like this are a perfect example!) If we can demonstrate our values through our actions we can motivate our community to do the same, however they feel most comfortable doing so. It is probably a bit cynical of me, but attaching a charitable gesture to a product or service could be considered a thinly veiled marketing hook by some customers.


#12

Could Monzo not have a goal similar to Google/Apple in that all the electricity comes from renewable energy like solar power? Plus then try and make sure you use suppliers who also have similar goals?

Might be an ambitious target but seems like a sensible environmental target


(Mike) #13

You’re saving money as :monzo: absorbs fx fees etc already- taking another slither away from that already minuscule revenue stream isn’t healthy… especially for a team that apparently runs on Huel and beer :joy:

I don’t know about others but I’d rather you take what you save in fx fees etc and donate that to a charity of your choice rather than assume the majority would be happy donating to a few large-ish charities. Every time someone I know does a fundraising run I find out about a charity I have never heard of but find pretty interesting - there would be no option to donate to it.

Having all cards be in some way eco-friendly and letting people make their own decisions as to where they’d like their sweat and tears be donated to is what I’d personally like to see… rather than all these gimmicks of donating to this that and the other where I’d never see the transactions being made.