Have you ever heard of the ethical banking? What kind of banks are they? Does it mean that the ones you are in at the moment are not considered ethical banks?
If you want to know what ethical banking is, which banks are part of it and everything you should know about them, then we leave you structured all the information so that you can easily understand it.
What is ethical banking
Ethical banking is an entity whose objective is to offer customers products that generate social value and that are responsible, that is, products that are morally acceptable and that are not socially contested.
In other words, we are talking about a type of entity in which economic benefits are not as important as social projects. That is, what they are looking for is to make a profit with all the money that is generated by their services. In addition, the client is taken into account, both in their opinions and in the type of projects that are carried out.
The main mission of ethical banking is none other than to develop society and also preserve the environment. How do you do that? Well, with financial products that are sustainable, such as the responsible use of money, sustainable investments, etc.
The origin of ethical banking
Although you may not know it, because it really is a concept that is not widely on everyone's lips, the truth is that ethical banking has been operating since the 80s that were when they emerged. They did it first in central and northern Europe and little by little it has been developed in other countries.
Since that time, the characteristics that define ethical banking have continued to endure over time, that is, offering products that create social value, investing in those morally acceptable projects or involving both savers and those financed.
Characteristics of ethical banking
On ethical banking you have to take into account some concepts that, from normal banks, differ quite a bit. For example: uterine
- Clients know at all times how their money is being used, what projects it is destined for and they can even know the company or people they are financing.
- This financing must always be based on social utility, that is, it must be done only in projects that benefit society or the environment.
- You can establish facilities and follow-ups of the projects, that is, it is not only a matter of leaving the money, but actually trying to support and help those financed.
- All the resources that are generated are destined to create employment and the labor insertion of people at risk of social exclusion, as well as to sustainable projects that are viable.
How Ethical Banking Works
To understand how ethical banking works you have to take into account the five principles that govern the foundation of ethical finance. Specifically, we are referring to:
- Transparency, in the sense that both savers and investors have the right to know what is being done with their money and where it is invested. There must be clarity and transparency on the part of the entity to inform at all times of what is done with the money, where it is going and what it is helping to create.
- Social utility, that is, all the projects that are carried out must be of use to society. For this reason, they must meet certain requirements such as that they help in the creation of employment, in socio-labor investment, in reducing inequality, in improving the environment ...
- Support and negotiation, in the sense that this type of banks cannot focus only on the recovery of the money they lend, but on negotiating and helping clients.
- Viability, because they are not "dumb" banks, and any project that they carry out, and that endangers the capital of their clients, must be viable, that is to say, that it does not suppose a loss for their client and, if it can be , there is a profit for society.
- Responsibility, in the sense in which they have to evaluate the responsibility of the investor and the client to make decisions.
Taking this into account, what ethical banking does is very similar to traditional banks, although it differs from these in that both savers and financed will go hand in hand, collaborating and participating in projects. On the one hand, savers lend their resources knowing what they are used for and what they will be used for; on the other hand, the financed, or debtors, will have the money they need to be more competitive and also to start their project.
What products do you have
If the idea of ​​ethical banking begins to interest you, you should know that products and services it offers are very similar to those of other banks. What are eos?
- Notebooks and cards.
- Investment funds.
- Microcredits.
- ...
The big difference between the most well-known banks and ethical banking is mainly based on the fact that the commissions that are paid are going to be used for social purposes. Always.
What ethical banks exist in Spain
The big question that you may be asking yourself almost from the beginning of this article. Are there ethical banks in Spain? Well, the answer is yes. Although they are not known, they do operate in Spain.
Among them we can cite you:
- Ethical banking Fiare.
- Triodes Bank.
- Coop 57.
- oikocredit.
- Colonya, Caixa Pollensa.
- Caixa d'Enginyers.
- FonRedess.
- Winkomun.
- Arç Cooperativa and Seryes Seguros.
Of course, there are more entities that are not in Spain but that operate internationally.
If after reading about ethical banking it has caught your attention and you want to know more to change your bank savings, the first thing we recommend is that you do more research. Talk to different banks to get a better idea of ​​it. This way you will be able to know what type of entities they are, what you commit to and if it is viable for you. Either to break with your bank or to allocate a part of your savings in another bank that, while it is there, will give it a more profitable use for society and for the environment.