The banks that grow trees as well as your savings: NS&I to launch new ‘green’ account this summer
- Oxbury Bank’s Forest Saver account funds woodland creation projects
- Gatehouse Bank has launched a range of Green Saver fixed-rate bonds and Isas
- Triodos Bank lends your money to environmental, cultural and social projects
Banks are branching out with green savings offers, which promise to plant trees using your investments.
National Savings & Investments (NS&I) will launch an account that helps the planet this summer, but other banks and building societies have been quicker off the mark.
Savers can already make a difference with the new Forest Saver account launched this month by Oxbury Bank.
National Savings & Investments will launch an account that helps the planet this summer, but other banks and building societies have been quicker off the mark
You won’t see any interest on this one-year bond. Instead, 0.7 per cent goes towards woodland creation projects on farms across Britain, through an organisation called Forest Carbon.
With interest rates at an all-time low, savers can pool together to make a difference at very little cost to themselves. With this account they’d be giving up just £7 interest a year on each £1,000 invested.
The first trees will be planted to make new woodlands in the Scottish Borders, with other farm sites across the UK to follow.
Set up in 2006, Forest Carbon creates new woodlands in the UK on behalf of companies and individuals wanting to offset the effects of their carbon dioxide emissions and improve the local environment.
The Chester-based Oxbury Bank, launched in January this year, is the first British bank in 100 years to lend money solely to farmers. It has other savings accounts where you can earn interest, such as its one-year fixed-rate bond at 0.53 per cent.
Gatehouse Bank has also launched a range of Green Saver fixed-rate bonds and Isas. For every bond or Isa opened or renewed, the bank will plant a tree in a UK woodland project through Forest Carbon.
Its selection of bonds includes a one-year deal at 0.55 per cent, or 0.65 per cent for two years.
Other providers with a green theme include Triodos Bank and Ecology Building Society.
Triodos lends your money to environmental, cultural and social projects, including renewable energy and organic farming.
It offers an easy access account at 0.15 per cent — a far higher rate than the 0.01 per cent with the major banks — or a one-year fixed-rate bond at 0.4 per cent. It also has Isas and children’s savings accounts, with a Junior Isa at 1.5 per cent.
Ecology Building Society, which is currently experiencing exceptionally high demand for its savings accounts, lends your money to eco-friendly homes and development projects.
It has joined the Net-Zero Banking Alliance (NZBA), launched last week, which unites 43 world banks, including Lloyds, NatWest, Barclays, HSBC and Santander, to fight climate change in the industry.
It pays 0.1 per cent on its easy access account and 0.3 per cent on its easy access Isa and has a monthly regular savings plan at 0.8 per cent.
All accounts are covered by the Financial Services Compensation Scheme, which pays out up to £85,000 per person if the bank or building society runs into trouble.
So far there are scant details on what the NS&I account will look like. It says only that UK savers will have the opportunity to contribute towards projects that will accelerate the transition to a low-carbon economy, create green jobs and support the collective effort to tackle climate change.
The Government-backed bank is looking to raise just £6 billion from savers in its current financial year, which runs until the start of April 2022, down from £35 billion last year.
But any money going into its new green account will not count towards this total.