How open banking is a game changer for sustainability

Tink | Apr 1, 2021

Open banking is proving to be a crucial tool in the fight to reduce carbon footprint and behave more sustainably – for individuals and businesses alike. By plugging open banking tech into digital services, people are able to track and change their behaviour in a meaningful way – from buying more environmentally friendly products to investing in sustainable companies. Here’s how.

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The environmental impact of our consumption habits is a global concern, and many of us are trying to find ways to reduce it bit by bit. In the race to create new digital services that help people and businesses reduce their carbon footprint, open banking is increasingly becoming one of the best places to start – as the realisation grows that financial data can play a big part in the fight against climate change.

At the same time regulatory pressure is mounting on a European level, for banks and financial institutions to take steps to ensure the financial system can manage sustainability related risks, and make sure investments and loans reach green and low-carbon initiatives. As part of this, banks need to engage with customers and gather data to understand their circumstances, to help them to prepare for the switch to a low-carbon economy.

New digital services focused on sustainability have begun to pop up over Europe, that help people directly through consumer apps, or that help banks reach their customers through services attached to their bank accounts. Or even new banks altogether, that offer ecological bank accounts to help people track and offset their carbon footprint. These tools leverage the opening up of financial data to help people understand their environmental impact – with great success.

Greenly taking France by storm

Just a year after launch, French carbon tracker Greenly was already the force behind 2.5 million people in France not only measuring and understanding their carbon footprint, but improving it.

In a nutshell, Greenly automatically tracks the impact of every expense a person makes, and puts this into a dashboard to show them what to focus on to reduce their carbon footprint – made possible by teaming up with Tink to aggregate transaction data from bank accounts across Europe. And it’s working. The users who engage with their dashboard at least every two weeks have a carbon footprint 20% lower than the average Greenly user.

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Svalna leading the way in Sweden

Swedish app Svalna lets individuals and businesses connect to their bank account in seconds, aggregating their transaction data, which is then categorised. The transaction data can show everything from shopping to travel, and the type of energy that’s consumed.

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