Triodos finally launch ethical UK current account!
April 26, 2017
After years of waiting, Triodos Bank are today accepting registrations for a new sustainable and ethical UK current account.
For 22 years UK savers have counted on Triodos for investments in socially and environmentally responsible projects and businesses, and were recognised as the #1 ethical bank in the UK in our Scorecard research. They are almost unique in being completely transparent about where they put your money, including maintaining a dedicated web portal at knowwhereyourmoneygoes.co.uk. So you can look up that housing association or vegetarian café they lent to down your street. And perhaps most crucially, Triodos completely avoid fossil fuels, tobacco, and arms – the triumvirate of bad business.
But for the first time, you can switch to Triodos for your daily banking needs. They are now issuing proper current accounts, complete with contactless Mastercard debit cards. These aren’t your usual everlasting-plastic jobbies either – these ones are made of biodegradable plant matter. Just don’t eat it.
In fact, Triodos are expecting these accounts to be popular enough that they will be rolling them out gradually from June – so after registering your interest today, you’ll still have to wait a couple of months to get your hands on one of these badboys.
Huw Davis, head of Retail Banking at Triodos, said:
“In designing this new current account, from the plastic used to the fees and charges structure, we have consistently adhered to Triodos’ principles of transparency, sustainability and fairness. Our current account provides the essential banking services expected by customers, but much more as well. We believe this new product will inspire the many people who make conscious sustainable choices in their daily lives to move their banking to a bank which shares their values, and which is working to have a real, positive, impact on society.”
One thing all of us raised on the “free banking model” might not expect is the £3 monthly fee Triodos will levy for the service. Their argument is that bank accounts cost money to administrate, and that the existing model relies on various hidden or punitive charges. And they’re not wrong – who of us hasn’t drifted our overdraft when times are tight and been stung for the privilege? One horrifying statistic from Government quango the CMA, is that banks make £1.2 billion a year in fees off unarranged overdrafts.
So, Triodos are at least being upfront about the administrative costs involved, and will include other measures to differentiate themselves from their more nefarious rivals – for example, they simply won’t provide unarranged overdrafts (although arranged overdrafts will be available at a fairly average rate of 18% AER). Beyond that, any “unpaid items will incur a basic charge of £5 – with a maximum monthly charge of £50 – to reflect the administrative costs to the bank.” This voluntary action puts them well ahead of the curve, with the prospect of other banks being forced to cap monthly charges as part of a raft of “Open Banking” measures only in 2018.
The obvious downside to this new product is that Triodos do not have branches, which might be fine for setting up an ISA, but for some people are crucial for managing their money day to day. This makes it harder for less technologically literate folks to bank ethically, but it remains to be seen whether this will be a decisive factor in the takeup of their new current account. Meanwhile, other banks are slashing traditional branches in favour of microbranches and online services left, right and centre, as we showed in our recent report, Abandoning Communities. So perhaps this is just the future we will have to contest.
Either way, Triodos have today issued a clarion call for day to day financial services that don’t cost the earth, or your wallet – an exciting challenge to business as usual up and down the high street. After campaigning for more choice in the ethical banking market for years – especially in the current account market – this comes as fantastic news, and we look forward to following this exciting and welcome development closely.
For the full lowdown, Triodos have produced this handy FAQ (pdf).
You can read our original profile on Triodos here.