Green Banking

Green Banking
Green Banking is when a normal bank takes into consideration all the social and environmental factors
while carrying on its basic operation of lending and raising deposits. It is also called ethical banking.
Green banks are regulated by the same authorities as traditional banks and have to abide by
the same rules.
All banks play an intermediary role in the economy; because of this the possibility for banks
contributing to sustainable development is high.
Banks can adopt a ‘carrot-and-stick’ approach, where environmental and social front-runners
would pay less interest than the market price for borrowing capital, while environmental
laggards would pay a much higher interest rate.
Some areas in which green banking is being adopted by banks are:
i. Online Banking facility and mobile banking– helps in saving paper, energy and
expenditure of natural resources.
ii. Green checking accounts like ATMs, Self-Service Kiosks, special touch screens.
iii. Supporting environmental friendly residential projects by offering various concessions
both for the project and individuals who avail home loans.
iv. Using solar and wind energy by installing wind mills for captive use.
v. Installing solar powered ATMs.
vi. Going in for rain water harvesting in their premises.