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Interest rates, APYs, digital banking features and location are all important factors when choosing a bank. But beyond that, finding a bank that aligns with your values can deepen your sense of trust and ensure that you’re supporting what you believe in.
With the emergence of online banking, many consumers are no longer confined by geography when choosing a bank. It just takes some research to find a financial institution that holds the same politics, faith or environmental consciousness.
Here are some options for consumers seeking banks that match their values.
Banking for political values
Banks lend money to various borrowers to make profit, and who and where they choose to invest in may have political implications. For example, a report co-authored by several environmentally conscious nonprofit organizations (including Reclaim Finance, Rainforest Action Network and BankTrack) found that JPMorgan Chase invested the most amount of money in fossil fuels out of U.S. banks, so consumers opposed to fossil fuel processing may prefer to deposit their money elsewhere.
A helpful resource for finding banks that align with your political values is Mighty Deposits, a bank comparison site that breaks down public data about how banks use their money and who owns them. You can search for a specific bank to see the breakdown of its investments, or filter banks based on certain criteria, such as those that invest in low-income communities.
Open Secrets, a nonprofit research organization, also provides a useful visual analysis of the political contributions of people and political action committees associated with commercial banks and how much of these contributions go to different political parties.
According to their mission statements, here are some of the top banks that contribute to progressive causes and campaigns, such as those that foster environmental consciousness and supporting unions:
- Amalgamated Bank
- Beneficial State Bank
- Sunrise Banks
Top banks that have contributed to conservative causes and campaigns include:
- Woodforest National Bank
- First Premier Bank
- Arvest Bank
There are several financial institutions with religious affiliations across the U.S., including the AdelFi credit union, a Christian-based Institution in Brea, California. Credit unions typically have a membership requirement, and at AdelFi it is pretty straight-forward: Anyone who agrees with its statement of faith can join.
At its core, AdelFi was designed to serve the financial needs of Americans engaged in missionary work around the world, letting them focus on the “full-time work of ministry,” says president and CEO Abel Pomar.
The credit union gives 10 percent of its profits to missionaries and other Christian-based efforts.
There are various institutions oriented around other faiths, too. For instance, University Bank in Ann Arbor, Michigan, operates University Islamic Financial, a lender that offers sharia-adherent products, including mortgages that are built around the Islamic prohibition against charging interest.
Meanwhile, Kosher Financial Institute provides a directory of banks and lending institutions that comply with Jewish law.
Environmentally friendly banking
If environmental impact is a top concern in your consumption habits, finding a bank or credit union that actively aims to be green is a good place to start.
One way to find a sustainable and environmentally-friendly bank is through the Global Alliance for Banking on Values (GABV). GABV members are required to meet certain criteria and share practices that put the environment and community first.
Here are some banks that have proven their dedication to protecting the environment:
- Amalgamated Bank: A GABV member, Amalgamated Bank ensures that 32 percent of its lending portfolio goes to climate solutions, and it has pledged not to lend to fossil fuel companies.
- Aspiration: While not technically a bank, Aspiration is a fintech that offers a Spend & Save account, which functions as an interest-bearing checking account and comes with an eco-friendly debit card. The debit card earns up to 10 percent cash back on purchases made at environmentally conscious businesses.
- Civic Federal Credit Union: Based in Raleigh, North Carolina, Civic Federal is a GABV member and achieved a carbon neutrality certification in 2020.
- Limelight Bank: Limelight is another eco-friendly bank that could be a good option for those who want to invest in certificates of deposit (CDs). The bank is paperless and only offers CDs, but its rates are highly competitive and the deposits help the bank fund solar energy initiatives.
- Southern Bancorp: In addition to promoting economic growth in impoverished areas, Southern Bancorp is LEED-certified, meaning that its buildings are designed with green initiatives in mind, such as by incorporating recycled materials. It’s also a member of GABV.
Socially responsible investing
Socially responsible investing (SRI) is an investment strategy that aims to balance financial returns and social good.
There are several variations of SRI investing. Some people really care about good governance, and they want to know that they are investing in companies that care about accountability and transparency. Others may want to invest in companies that don’t rely on sweatshop labor.
SRI strategies are hot in robo-advising, especially as they try to court younger investors. For instance, Morgan Stanley offers a Global Sustain Portfolio, which is ideal for investors who want to limit their carbon footprint.
Betterment has several themed portfolios related to social responsibility, such as a sustainable crypto portfolio and a social impact stocks and bonds portfolio.
According to a 2022 survey by PwC, U.S. investors expect to increase their socially responsible investments — those that incorporate environmental, social and corporate governance (ESG) criteria — by more than double in less than five years. Furthermore, 60 percent of those investors said that ESG investing has already resulted in better returns overall than non-ESG investments.
While companies like Morgan Stanley and Betterment make SRI an option, it is the bread and butter for robo firms like EarthFolio, the robo platform from Blue Marble Investments.
The case for staying local
Trying to align your values with your bank may not necessarily involve switching institutions, especially if supporting your local community is important to you.
Many banks give back to their communities in some way. The Bank of North Dakota is a great example of a local bank that proactively works to address the state’s needs. It gives up much of its profits to the state and to mission-driven loan programs, with the goal of driving economic development and infrastructure projects in North Dakota. For example, the Bank of North Dakota provided recovery funding during the 2011 floods in Minot and Bismarck, North Dakota.
If you bank locally, see what initiatives your bank is invested in; it might very well line up with your values.
Certifications for certain values
Just as businesses can acquire certifications to showcase their commitment to specific values, so too can financial institutions. These certificates act as markers of trust, indicating that the bank adheres to certain guidelines or fulfills specific criteria for values such as environmental sustainability, ethical investment or community impact.
Not only do these certifications give banks a competitive edge, but they also help guide consumers in making choices about where to entrust their money.
Here are some popular certifications given to banks and what they signify:
|Certification||What it means|
|Association of Military Banks of America (AMBA)||Members of the AMBA comply with certain standards supporting military and veteran communities.|
|B Corp||Awarded to banks that meet high standards of social and environmental responsibility, public transparency and legal accountability.|
|Community Development Financial Institution (CDFI)||CDFIs, certified by the government, are dedicated to providing responsible, affordable lending to low-income people and communities.|
|Equator Principles Financial Institution (EPFI)||Adhere to 10 principles that ensure that financial products don’t harm the environment or vulnerable communities.|
|GABV||Membership is given to financial institutions that are committed to socially responsible banking and environmental sustainability.|
|Minority Depository Institution (MDI)||MDIs are federally protected and are institutions where either 51 percent of the voting stock is owned by minority individuals or a majority of the Board of Directors are minority individuals and the institution predominantly serves minority communities.|
|Women’s Empowerment Principles (WEPs)||Initiated by UN Women and the UN Global Impact, this certification is awarded to institutions committed to gender equality and women’s empowerment.|
Value-based banking is more than just financial transactions. It’s about integrating personal values and social concerns into our banking choices.
Through various certifications and transparent reporting, some financial institutions now offer insights into their operations and investments to help consumers identify and support institutions that reflect their ideals.