Like many Aussies, you care about the environment. You make good use of your reusable coffee cup, your reusable water bottle and your reusable shopping bags. You take care to recycle even soft plastics, and you use your food waste to make compost. In a bid to reduce your carbon footprint, you take public transport when you can, and you offset your carbon output when you fly. You have solar panels on your roof. You may even drive a hybrid.
With all that going on, you could be forgiven for overlooking that little piece of plastic in your wallet. Weighing in at a mighty five grams, your credit card probably doesn’t seem like much of a cause for concern, given all the other, more sizeable plastics that flow through your life on a daily basis. But, that five grams becomes a much bigger problem when you consider just how many cards there are currently in circulation.
In Australia alone, there are around 14.8 million credit cards in use right now. That’s 74,000kg of PVC (polyvinyl chloride: a notoriously difficult-to-recycle material) that’s sitting around in our nation’s wallets. And of course, it’s not just credit cards. We also have debit cards, prepaid cards and gift cards, all of which simply get thrown away when they’re no longer of use. Cards are lost, stolen, they expire, and they are re-issued. All this adds to the planet’s collective plastic waste.
Around the world, card providers are making the effort to go green with their cards. Some are issuing cards made from recycled or ocean-reclaimed plastics, or from wood, corn or metal. Other providers go even further, allowing cardholders to offset the carbon footprint created by their purchases, or to donate to eco charities doing good around the world.
Ethical banking is also gaining traction, encouraging consumers to bank with providers that choose not to invest in harmful industries such as coal and oil. Bank Australia in particular is an awesome example of ethical banking in action.
In this post, we’re going to take a closer look at what’s going on in the world of eco credit and debit cards. Starting by checking out the various ‘green’ cards out there, we’ll then get into what impact switching out plastic cards could have. From there, we’ll delve into other ways to go green, including going cardless, reducing your carbon footprint by making mindful choices when using your card, and donating to worthy eco-focused charities.
What can you expect from green or eco-friendly cards in Australia? Not much, unfortunately. Only Gateway Bank and fintech start-up Hay currently offer eco cards within their range. But over time, that should change. Following the lead of other financial services providers around the world, Australian card providers will eventually catch on, especially as younger generations come up.
Here are some of the green credit and debit cards currently available, looking at how they work, and what they’ve got to offer.
Back in May, Gateway Bank launched a new plant-based debit card. The first of its kind from a bank in Australia, the Eco Debit Card is largely made of Polylactic Acid (PLA), which is created from fermented plant starches like cassava, corn or sugarcane. The only non-plant materials used in the card are in its magnetic strip and microchip.
Australian fintech Hay recently introduced its prepaid Hay Visa Card. Made from 85% biodegradable materials, the card is designed to remain durable while in your wallet, but will break down when in biologically active landfill. Hay points out that even its packaging is made from non-virgin sugarcane by-product, and is 100% recyclable, biodegradable and compostable.
Earlier in March, UK challenger Starling Bank launched the nation’s first Mastercard debit card to be made from recycled plastic, which it says will save 2kg of carbon dioxide emissions for every 1kg of first-use plastic it replaces. Recycled material makes up 75% of the card, which is sourced from EU industrial waste from printing and packaging industries. Starling also happens to be a branchless, paperless bank that runs on renewable energy.
Also in the UK, finance services company Tred recently released its debit card made from recycled ocean plastic. What sets this card apart though, is the fact that it’s paired with an app that tracks the cardholder’s carbon output based on their spending. Cardholders can choose to offset that carbon output via a certified Scottish tree-planting scheme.
Designed for kids, the UK’s gohenry Eco Card is a sustainable debit card that’s not only made from plants, but also plants a tree when it’s first used. The card itself is made with biodegradable PLA, meaning 82% of the card will decompose in landfill. And, having partnered with Eden Reforestation Projects, gohenry ensures a tree is planted in celebration of the first time every Eco Card is used.
While it is yet to launch, UK fintech TreeCard has had plenty of interest in its new wooden card. Once launched, the card will allow users to link their bank account to the TreeCard app, to then route their spending through the Mastercard-issued TreeCard. From there, a portion of the card transaction fee each purchase generates is put towards tree planting projects run by green search engine Ecosia.
Over in Germany, fintech Tomorrow launched one of the first wooden cards on the market at the end of 2020. Aside from looking good in wood, this non-plastic offering also allows customers to offset their annual carbon footprint. As a B Corp, Tomorrow promotes ethical banking by only financing sustainable and social projects.
Meanwhile, in San Francisco, fintech Unifimoney announced the launch of its new card made with “ocean plastic” mid last year. Aside from being made with recycled plastic, the card – which is issued by UMB Bank – provides a donation to The Ocean Foundation each time it’s used.
But it’s not just fintechs and challenger banks getting in on the action. Here are some eco-friendly card offerings currently provided by the bigger players.
Back in October, the UK’s largest building society, Nationwide, announced its intention to switch to eco-friendly debit and credit cards made from recycled plastic, with the aim of saving 35 tonnes of carbon emissions each year. Nationwide, which issues 5.4 million cards annually, said it was the first major UK bank or building society to take such a step.
The provider also currently offers customers an in-branch recycling service for expired cards and has pledged to eliminate single-use plastics by 2025.
Around the same time, the largest bank in Denmark, Danske Bank, made a similar announcement, saying it was taking steps to phase out existing payment cards and replace them with new, more eco-friendly payment cards made from 86% recycled plastic.
Spanish multinational financial services company, BBVA, announced it would start offering recycled cards through each of the countries in which it operates – namely within Spain, South America, North America, Turkey and Romania – by the end of 2021. By 2023, the bank will phase out plastic cards completely, which can only be a good thing, considering it currently has more than 90 million cards in circulation.
|TIP: When looking for eco-friendly cards, keep an eye out for Mastercard’s recently introduced ‘eco’ badge. This badge is designed to help users identify cards produced in a more sustainable fashion from “recyclable, recycled, bio-sourced, chlorine-free, degradable or ocean plastics”.|
What makes a card ‘green’ depends on how it’s made, what materials it’s made with, and how easily those materials break down after the card’s been disposed of. Let’s look at a few examples.
In terms of the Hay Visa Card, Hay actually started out with the packaging, opting for a lightweight option to reduce its carbon footprint, while utilising a non-virgin sugarcane by-product that was not only recycled, but 100% recyclable and compostable. From there, the fintech looked at how it could create a card that was just as green.
The card itself is made from a material called SICOECO. This is a rigid PVC film with an additive that helps it to degrade in the right conditions, breaking down in a tenth of the time it takes standard plastic to break down. In saying that, the card is still perfectly durable, and is designed to last up to seven years. Hay provides information on how to properly dispose of the card on its website.
Going in a different direction, 75% of the Starling debit card is made with recycled PVC (or rPVC), which is sourced from EU waste materials. The remaining 25% – made up of the magnetic strip, chip and contactless antennae – can’t yet be made from recycled materials, but Starling says it’s looking into how it can work on this, such as by making the card’s chip smaller.
As for the gohenry Eco Card, it is made from a renewable material called polylactic acid (PLA). Unlike standard plastic, which is made from petroleum, coal and crude oils, PLA is derived from field corn. As such, it is fully biodegradable and non-toxic if incinerated.
Once the card has expired, the cardholder simply cuts out the chip and magnetic strip, cuts up the card, and puts it in the bin (there’s no need to throw it in with recycling). Using sunlight, soil and all the microorganisms that are found in soil and rubbish, the card will biodegrade in six months. Which, admittedly, is a nice, short time compared to standard PVC, which takes about 400 years.
At the start of this post, we mentioned the fact that Australia has around 14.8 million credit cards in circulation, which equates to 74,000kg of plastic waste. Relative to the rest of the world, however, Australia is a small fry.
It’s estimated around six billion payment cards are produced around the world each year. This number includes credit cards, debit cards and bank cards, but would be further bumped up by other plastic cards such as gift cards. Putting that in perspective, that’s more than 30 million kg – or 30,000 tonnes – of payment card plastic created each year.
Changing the way these cards are made, whether by using recycled resources or biodegradable materials, could have a huge impact on our environment. Again, let’s look at a few examples to find out how these cards are making a difference.
While the steps being taken by these eco-driven card providers are to be applauded, none of the solutions they offer are perfect. Wooden cards, for example, are less flexible than plastic cards, making them more likely to break and need to be replaced. Recycled PVC is still PVC, so while rPVC cards give that PVC a second use, it’s still incredibly hard to break down after the card is thrown away.
According to Katie O’Hara, conservation manager at the Loggerhead Marinelife Center in Juno Beach, Florida, any plastic use, even if it’s recycled or reclaimed, can be problematic.
“Anything made from recycled or reclaimed ocean plastics is not truly recyclable or sustainable,” she said (1). “When plastics are recycled, they degrade, releasing nano and microparticles into the water used to recycle them. Plastic cannot be reused more than once or twice, and when it is recycled it’s still harmful to the environment.”
There’s also the environmental cost of creating cards to consider. No matter what they’re made of – whether that’s wood, metal, recycled or reclaimed plastics, or even biodegradable materials – creating, manufacturing and distributing these cards takes a toll on the environment.
So, is there another alternative? For all the good these green initiates are doing, it could be argued that you could remove much of the problems associated with plastic cards simply by getting rid of them. Yep, we’re talking about going cardless. By taking cards out of the equation, there is no need to manufacture them, distribute them, or deal with them once they’re no longer needed.
Fewer pollutants all round then.
And while Australia may be lagging in its green card offering, we’re pretty comfortable with digital and cashless payments. The 2021 Global Payments Report suggests the Australian economy will be 98% cashless by 2024, making Australia the fourth most cash averse country in the world, behind Sweden, Denmark and Hong Kong. (2)
Not only that, the report also suggests the use of mobile wallets here in Aus will double over the next four years.
So if cards can disappear, so perhaps can banks. Or their branches, at least. Enter, the neobank.
While you may or may not have heard of neobanks, this new style of bank operates digitally, rather than from a physical branch or office. Shunning the physical infrastructure and digital operating systems being used by financial organisations currently, these neobanks use technology developed from scratch, operating solely within an app on their users’ phones.
It’s worth pointing out that while we have branchless banks that operate digitally in Australia – such as ING, ME and UBank – these are not neobanks, because they utilise the infrastructure of their parent companies to operate. ING, for example, is owned by multinational Dutch bank ING Group, while ME is owned by a group of superannuation funds, and UBank is owned by NAB.
So, while these banks may offer great digital services, they are not classified as neobanks because they use the legacy systems of their parent companies.
However, there have been a number of neobanks that have gained their license to operate in Australia over the past couple of years. Some have been more successful than others. Within a relatively short space of time, Xinja Bank chose to exit banking and hand back its license, while 86400 was purchased by NAB. Volt Bank took its time to get on its feet, but is now in Beta, while Judo Bank and in1bank both seem to have hit the ground running.
What about digital banks? Unlike neobanks, digital banks operate digitally, while making use of the infrastructure of their parent companies. Examples include Up Bank, which is a subsidiary of Bendigo and Adelaide Bank, Douugh, which has partnered with Regional Australia Bank, and Hiver, which was recently launched by Teachers Mutual Bank. Other players on the rise include Hay and DayTek Capital.
Back to credit cards. If you want to go green with your credit card, there are a number of ways you can go about it.
As Rene Thejsen, Head of Cards and Consumer Payments at Danske Bank says, “We’re well aware that our more eco-friendly payment cards aren’t going to solve the world’s climate challenges, but they are a small step in the right direction.” Overall, it’s all about steps. What may seem like little steps here and there, should add up to more substantial change over time.
Founder of Creditcard.com.au. Roland has extensive knowledge about credit cards in Australia. Known as a credit card expert, he has been featured on tv and in various publications. Some popular offers on our site right now include the ANZ Low Rate. This special offer has no annual fee first year, a low purchase rate and long 0% balance transfer. Have a look also at the huge 0% for 30 months balance transfer from Citi with no balance transfer fees.
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