Young people are avoiding banks with weak environmental credentials as demand for sustainability in financial services increases, according to new data.
Bank customers aged 18-34 are demanding financial products that allow them to manage their environmental impact, while 62% of customers said they want to be able to track their carbon footprint, according to data from Swedish open banking firm Tink. .
Tink bosses said transaction and payment data now gives customers a window into the wider impact of their spending habits.
“Payment information can be of great value in gaining insight into your carbon footprint,” Jan van Vonno, research director at Tink says City AM.
“From this information, you can retrieve insights into your lifestyle, how it aligns with your own sustainability goals, and how you can address certain issues.”
Tink warned that banks that fail to meet sustained demand risk losing business as consumer demand increases.
Around 42% of young users said they would not use a financial service provider they did not consider environmentally conscious, and 40% said they only invest their money in businesses or funds considered sustainable, double the national average of 21%.
van Vonno said incumbent banks are increasingly turning to fintech firms to provide transparency, and open banking has the potential to unleash data sharing between firms.
It comes as a wave of new financial products are launched to allow shoppers to track their carbon footprint, with a new debit card, Ekko, rolling out to users in London this month to allow users to track the impact environmental aspect of every purchase they make.
Big tech giants are also turning to public banking companies to provide a greater level of visibility into their customers’ spending habits.
Last month, Visa acquired Tink for $1.8 billion while Apple last week acquired British start-up Credit Kudos.