What does ethical lending in Australia even mean and who qualifies as an ethical lender? Let’s first define our terms, here’s what we mean when we talking about a bank, credit union or lender being ethical.
What is ethical lending?
Ethical lending in Australia can be considered through the lens of:
- What areas, causes and businesses the bank invests in including fossil fuel
- Who they lend money to, and
- What causes they support.
Ethical banks may choose not to lend to the fossil fuel industry or fund projects which are focused on mining. Or they may choose to invest their money in renewable energy. They may have a social and environment conscience and don’t get involved in weapons manufacture. Or are involved with the promotion animal welfare. They may stay away from tobacco companies, human exploitation, gambling and pornography too.
Another way of looking at it is through the lens of what values you hold and what matters most to you. For example, if you ride to work, buy from local farmer’s markets, use a reusable coffee cup and do everything in your power to reduce your carbon footprint then chances are you are very environmentally conscious. But if you then bank with or inadvertently invest in a bank which supports the fossil fuel industry, then you are not banking within the bounds of your own ethics.
How do I find out which banks are ethical or environmentally friendly?
There are a range of resources you can rely on to understand whether the bank you are using or considering using supports the things that matter most to you. We have a range of lenders available who offer ethical lending options and as a business choose not to invest or lend to polluting or unethical industries:
- Bank Australia
- Teachers Mutual Bank
- Adelaide Bank
- Auswide Bank
- Bank First
- Bendigo Bank
- Heritage Bank
- 86400
- Suncorp
There are also a range of lenders who offer “green” loans or products. This means the bank itself might still be involved in the fossil fuel and other unethical industries. Despite this, they are offering options for consumers to invest in renewable energy and that sort of thing.
One good resource is Market Forces who keep track of which banks lend to the fossil fuel industry. Click here to see which banks are invested or lend to fossil fuel producing businesses: https://www.marketforces.org.au/info/compare-bank-table/. You’ll be very pleasantly surprised just how many banks and credit unions don’t support the fossil fuel industry.
Another place to look is called Don’t Bank on the Bomb which will show you which banks around the world lend money to nuclear weapons producers: https://www.dontbankonthebomb.com
Where you put your money matters
If you feel very passionate about a particular cause (or many causes) then where you put your money matters. This goes for your savings and investments, along with who you borrow from. The interest you pay on loans may be invested according to the banks interests (which may differ from your own).
So, if you want to support an ethical bank then the things you can do include:
- First, moving your savings and transaction accounts across to an ethical bank,
- Using an ethical lender for your personal lending needs such as credit cards and home loans, and
- You can ensure your superannuation is invested with an ethical fund too.
We have a range of lenders on our panel who are environmentally and ethically minded. If you’d like to look at home loan options from an ethical bank then get in touch.