Ethical banking

patsy555

What is the best UK ethical bank,  Triodos or Nationwide?

colsten

Nationwide is not a bank.

As to which is more ethical, this would depend on how a company matches your personal expectations.

EarthBoy

You need to decide what you mean by ethical. What's ethical to one person could be quite unethical to someone else.

Stuart_W

What is "Ethical" is a personal decision, and you need to think about what it is you either want to actively support or actively avoid in terms of how your money used, and whether you see ethics being a matter of how the business is run, how it is owned, what it does with it profits, or all 3. Cultural/religious beliefs may also play a part.
This might help, but us just one viewpoint:
https://www.ethicalconsumer.org/money-finance
I personally have stuck to banking with the Co-op and saving with Ecology Building Society, a personal decision by me that I'm happy with (and never expected my Ecology saving account with 1% interest minimum guarantee to end up being such a good deal! (Not available to new savers)).

gsmh

The most ethical bank is Triodos - however banking ethically involves compromises. Triodos is OK if you can live with faster payments which can take two days and often need a phone call to get them out of a queue . . . Triodos does not do NFC payments either, so no Apple or Google Pay. You can get around it by using a Curve card and linking your Triodos debit card to that. Triodos shouts about how ethical it is and if ethics is your only criterion you will do well with them. The Ethical Consumer magazine rates Nationwide and Cumberland BS highly - so with Nationwide you will achieve an 8 out of 10 but will be able to access all the features expected of a modern bank. The Cumberland BS only offers current accounts to those living in their catchment area. Monzo, Starling and Metro Bank also do well - mainly because they haven’t burnt their fingers, rather than having proactive ethical policies. The Co-operative Bank has a first class ethical policy but is owned by a collection of companies which are not in themselves particularly ethical. They seem happy, however, to allow the Co-operative Bank to continue its ethical policies. There is a campain group, Save Our Bank, which puts pressure on the Bank to maintain its ethical status and to have its practices externally audited. The Bank is happy to engage with Save Our Bank and the organisation frequently reports back on their dialogues.

patsy555

Thanks very much for the comprehensive answers, I appreciate the time taken and they’ve given me lots to think about

blue.peter

gsmh said:

The most ethical bank is Triodos - however banking ethically involves compromises.

There's another compromise required, one that you haven't mentioned. They charge £3/month for their current account, whilst other banks will run one with no charge, or even pay you cashback and/or interest. From a purely ethical perspective, I like the look of Triodos. If ethics was my sole concern, I'd go there like a shot. But that charge, and what you've said about their service (thanks for that), puts me right off. If/when I decide to dump one of my present current accounts, I think that I'll probably go to the Co-operative - even though I don't like the look of its owners. (I already have a Nationwide account. I find their service pretty good. I rather doubt that I'll want to dump them in the foreseeable future.)

blue.peter

PS - It occurs to me that the Co-operative Bank requires a very similar compromise to the one that I already have to make with my ISA. That ISA is invested solely in ethical funds (primarily because I can't bear the thought of investing in things like tobacco, gambling and armaments). But where can you find an ethical investment manager? Although the ethical funds that they operate have decent investment policies, they all also seem to run funds that I don't like at all.

Incidentally, funds that operate an ethical investment policy publish that policy so that potential investors can see before they buy. I've got quite a few stored on my hard drive. Getting back to banking, the Co-operative also publishes its ethical policy. It can be downloaded here (you'll need to scroll down the page a bit to find the link). @patsy555, you might find it helpful if you're considering using that bank.

bapwich

I've just made the switch from HSBC to Triodos and I'll admit it does seem to be that you are forced to compromise a bit on the overall 'banking experience' in order to invest/save/bank in a mostly ethical way. Setting up the account was fine, and I've found their new e-banking website pretty good (in line with what I'm used to). Admittedly having to use the little secure pass pad thing is a bit annoying and will stop me making some new payments whilst I'm on the go, but again that's a compromise I'll live with. Their mobile app seems fine so far and I have never used Apple Pay so haven't missed that. I like that you can see on a map where they've invested, and see some local companies/communities that have benefited. I'm also happy to pay the £3, seeing it as more like a charitable donation. My only real moan is, as some people have mentioned, the length of time it takes for payments to move in/out of my current account to other banks. In the week that I've had it I've been moving things about from my old account etc, and it has taken so long that I find myself wondering if it's going to happen at all. It does, but I've got so used to it being quick and instantenous from my old bank, it's a bit jarring. . Being environmentally friendly is hardly ever cheaper or more convenient, but we do it because it's the right thing to do. At the moment I'm willing to give it a go as I'm hopeful the eco/ethical benefits will outweigh the inconvenient bits. I suppose they are first world problems after all.

gsmh

@bapwich Great to see another user who is keen to bank ethically. I found the faster payments with Triodos challenging - especially when I transferred a larger amount out of my account and it still hadn't moved the next day. I had to call them and ask why and they asked me a few questions and said the transaction would be made by the end of the day. They told me that the faster payments system can take two days and they were operating within the terms of the faster payments system. The Faster Payments website however says "The money is usually available in the receiving customer account almost immediately, although it can sometimes take up to two hours". Every time I made a payment I was left wondering whether the money was going to reach the payee or whether it was lost in the ether. When I sold a bike, the buyer wanted to pay me directly using the faster payment. I had to give details of another of my current accounts otherwise I wouldn't know whether the payment was successful (and genuine) for a few hours. I chose Metro Bank and the credit was there within seconds. Triodos uses NatWest as its 'clearing' bank, but this excuse of a third-party clearer doesn't wash when Metro Bank (AFAIK) uses Barclays.

All in all, Triodos was OK, and it was great to be banking ethically (according to my definition of ethical before anyone else jumps in) but the lack of Apple Pay and the slower payments were what drove me elsewhere.

bapwich

@gsmh Yes I'm not sure how practical it will be in the long run if I have to wait such a long time. I am keeping my HSBC account open so that I'm able to pay in cash/cheques at a high street bank and then transfer it over. That's a good tip about using another account when someone wants payment/you need to pay them quickly, so I'll probably do that when needed.