A new "green banking" study by Javelin Strategy & Research finds that 3 out of 4 consumers are still "clinging to paper statements".
A new report released today by Javelin Strategy & Research examines green banking issues, including consumer habits, green banking behaviors and recommendations for financial institutions seeking to attract environmentally conscious consumers. Researchers found that although most consumers expressed an interest in adopting green banking behaviors, three out of four consumers still receive paper statements. According to Javelin, if every U.S. household stopped receiving paper bills and statements, 687,000 tons of paper would be saved every year – enough to circle the Earth 239 times.
“Green banking clearly has a direct, positive effect on the environment, but the benefits go much further, reaching into security and cost,” said Jim Van Dyke, president of Javelin Strategy & Research. “Banks will save money every time a customer switches to electronic statements and transactions, and consumers significantly reduce their risk of becoming a victim of identity fraud by going paperless and using online banking services – everybody wins.”
While environmental issues have grown in importance with bank customers, green banking habits have yet to take hold. The report finds that this is largely because consumers are not aware of how they can make a difference and financial institutions have yet to find incentives that compel customers to participate.
“Most consumers want to do the right thing, but if the process appears confusing or inconvenient, they simply aren’t going to bother changing their banking habits,” said Mark Schwanhausser, research analyst at Javelin Strategy & Research. “In many ways, it’s up to banks to influence consumers. They must offer tangible, compelling ‘green’ options and make them as simple as screwing in a CFL bulb.”
For consumers seeking to make their banking habits “greener,” Javelin Strategy & Research offers the following five recommendations:
- Turn off paper statements. This is the easiest and most widely available way to make an immediate, substantial impact on your carbon footprint and lower your risk of identity fraud.
- Switch to direct deposit. Cut off the paper trail that goes along with depositing paychecks. Bonus: In most cases, your money is deposited into your account earlier through direct deposit.
- Start using online banking. Checking your accounts online is not only convenient, but you can also significantly reduce waste by managing and paying bills online. Bonus: Save money on postage and reduce the possibility of identity fraud.
- Skip the receipt and deposit envelope. Don’t take a receipt and instead, check your accounts online later or make a note of it immediately in your checkbook. Recently, many banks have installed ATMs that don’t require envelopes for deposits.
- Try mobile banking. By signing up for mobile banking, you’re likely to cut down on trips to the ATM or local branch, which reduces pollution and saves you money on gas.
Javelin researchers believe availability, accessibility and complexity are the central challenges stalling the adoption of green banking behavior. Financial institutions must focus on products and promotions that speak directly to environmentally conscious consumers, including “green audit” calculators to help consumers compute the environmental impact of their banking behavior, a one-stop paper statement shut-off option for all accounts and green banking marketing campaigns that reward customers for eco-friendly practices.