People are more motivated to make environmentally friendly lifestyle choices by the impact these actions have on the planet, rather than the financial savings that may result from them. That’s according to new research from Cogo, the carbon footprint management firm.
The study discovered that 64 per cent of respondents would be willing to take action based on carbon impact data, compared to only 55 per cent who would act based on financial savings data. This difference, which equates to 4.6 million UK banking users, was particularly significant for actions that do not save much money or have an upfront cost.
Emma Kisby, Cogo’s CEO for EMEA, commented: “We expected that financial savings would be a strong motivation, and carbon data might strengthen it further by adding an emotional element. But, what we have actually found is that when it comes to making sustainable lifestyle changes, people are more willing to do it for altruistic reasons, over simple financial gain – even when many are tightening their belts.”
However, the research also highlighted a lack of awareness among climate-conscious consumers about the sustainable finance products offered by high street banks. Just 16 per cent of respondents were aware of such options, with one in four wanting to hear more about them.
Cogo argues that banks could play a key role in promoting more sustainable behaviour, particularly in relation to actions that have an upfront cost.
The study also found that 68 per cent of respondents were feeling insecure about their financial situation, which presents an opportunity for banks to address this through sustainable finance products.
Banks need to get a ‘headstart’
“It’s clear that many consumers don’t feel supported to confidently take sustainable action when it comes to their finance products,” says Kisby. “Banks are a vital service which most of us are in contact with on a regular basis – almost everyone has a bank account. This means your bank is the ideal place to get information on the climate impact of spending decisions and other financial choices.
“The consumer demand for green banking options is rising, and the role which financial services play in the climate crisis – and solving it – is increasingly understood.
“Banks need to prepare for the age of the conscious consumer and work to align their products and services to a sustainable way of banking and living. They can get a headstart by tailoring financial solutions based on the carbon saving actions their customers are most willing to take.”
The study revealed the most in-demand options were green loans, mortgages, bonds and grants. Previous Cogo research found that 48 per cent of UK mobile banking users are specifically in support of their bank helping them to make more pro-environmental purchasing choices.
Last month, Cogo also revealed that the number of NatWest customers accessing its carbon impact data through their banking app has increased by 10 per cent. The number today stands at 334,500 active users – up from 300,000 in six months.