2022
9
UK Sustainability in Financial Services Market Report 2022
2023-01-26T03:05:10+00:00
OX1100587
2195
159855
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Report
en_GB
“With the majority of consumers showing concern over the environment, there is a large market for green financial products. It remains difficult for people to know if one provider is…

UK Sustainability in Financial Services Market Report 2022

£ 2,195 (Excl.Tax)

Description

Understand the current trends and opportunities in sustainable financial services. Our sustainability in financial services market report provides in-depth analysis of sustainability in banking and also covers consumer attitudes towards sustainability, perceptions of sustainability in financial services and the importance of environmental credentials in banking. Use Mintel’s research to become more informed and tackle challenges in your industry. Read on to discover our insights. 

Sustainability in Financial Services – Industry Overview

With the majority of consumers showing concern over the environment, there is a large market for sustainable financial services. 

However, there is a concern that the cost-of-living crisis will put sustainability on the back burner. Brands must shift the perception to highlight the cost savings of sustainable purchasing and green financial products to counter concerns about short-term costs.

Consumer Trends in Sustainable Banking

The need for affordable green financial products is heightened by the cost-of-living crisis. With many households looking to cut back, a third of consumers say rising living costs mean they cannot pay more for sustainable financial products. 

  • Sustainable banking market consumer trends: 79% of people say they find it hard to know if one financial provider is more sustainable than another.
  • Consumer attitudes towards sustainable finance market: 55% of consumers believe a bank’s environmental credentials would be an important consideration if they were moving their account. This is only likely to grow in the future. 
  • Sustainable banking market challenges: Just 28% of consumers trust financial providers’ environmental claims, highlighting a significant challenge for brands around messaging and transparency.

Sustainability in Banking – Opportunities and Future Trends

More transparency and consistency are required to help consumers gauge sustainable finance. There is a need to help consumers fully understand the environmental impact of financial providers. Banks must highlight the positive efforts they are making in this area while remaining transparent about historical fossil fuel financing. In the longer term, financial services must move towards sustainability, so the onus is not on the consumer to research environmental claims. Until then, regulation and help understanding ratings will be vital.

Read on to discover more about our Sustainability in Financial Services Market Report, read our UK Everyday Sustainability Market Report, or take a look at our extensive financial services market research.

Our UK Sustainability in Financial Services Helps You to Quickly Understand

  • Consumers’ leading environmental concerns.
  • Perceptions of sustainability in financial services and other organisations.
  • Where consumers research their bank’s environmental records.
  • Trust in financial providers’ environmental claims.
  • The importance of environmental credentials in banking.
  • Attitudes towards sustainability and the rising cost of living.

Popular Financial Service Companies Covered in this Report:

HSBC, Barclays, Santander, Natwest, Nationwide, Starling Bank, Monzo, Revolut, Treecard, Tred.

Expert Analysis from a Financial Services Specialist

This report, written by Adrian Reynolds, a leading analyst in the financial services sector, delivers in-depth commentary and analysis to highlight current trends in the sustainable food market and add expert context to the numbers.

With the majority of consumers showing concern over the environment, there is a large market for green financial products. It remains difficult for people to know if one provider is more sustainable than another, however, with greater regulation needed to standardise green claims and ratings. It is important sustainable bank account options are offered but this must be alongside banks reducing investments in fossil fuels and highlighting renewable energy projects. Otherwise consumers will increasingly look towards challenger brands with sustainability at their core.

Adrian ReynoldsAdrian Reynolds
Principal Analyst – Financial Services

 

Table of Contents

  1. Overview

    • Key issues covered in this Report
  2. Executive Summary

    • The market
    • The majority of consumers are keen to find sustainable products
      • Figure 1: Ethical shopping behaviours, 2022
    • Declining financial confidence will require affordable, sustainable products
      • Figure 2: Financial confidence for the year ahead, 2021-22
    • FCA set to clamp down on greenwashing in investment industry
    • Companies and brands
    • HSBC moves to end new oil and gas investments
    • Barclays sets $1 trillion sustainable finance target by 2030
    • The consumer
    • Climate change tops consumer environmental concerns
      • Figure 3: Environmental concerns, 2022
    • Retail banking brands are viewed positively on sustainability
      • Figure 4: Perceptions of organisations impact on the environment, 2022
    • Consumers lack trust in sustainable banking information sources
      • Figure 5: Researching banks’ environmental record, 2022
    • Financial providers need consistent and transparent messaging to build trust
      • Figure 6: Trust in financial providers’ environmental claims, 2022
    • Offer sustainable accounts to attract switchers
      • Figure 7: Importance of environmental credentials in banking, 2022
    • Banks must highlight efforts to support renewable energy projects
      • Figure 8: Important environmental factors when moving bank account, 2022
    • Consumer desire for convenience leaves the sustainability onus on providers
    • Help consumers to save money while saving the planet
      • Figure 9: Attitudes towards sustainability in financial services, 2022
  3. Issues and Insights

    • More transparency and consistency are needed to help consumers gauge sustainable finance
    • Show consumers that sustainability does not need to cost more
    • Digital challenger brands can fill the sustainable void
  4. Market Background

    • The majority of consumers are keen to find sustainable products
      • Figure 10: Ethical shopping behaviours, 2022
    • COP27 adds focus on climate change with a loss and damage fund
    • Conference receives criticism for not going far enough to fight climate change
    • Banks use COP27 to highlight sustainability efforts
    • Rainforest Action Network increases scrutiny on banking sector
  5. Market Drivers

    • High inflation could stop consumers prioritising sustainability
      • Figure 11: CPI and CPIH, 2019-22
    • High energy prices increase the need for renewable sources
      • Figure 12: Issues impacting consumers, 2022
    • Declining financial confidence will require affordable, sustainable products
      • Figure 13: Financial confidence for the year ahead, 2021-22
  6. Regulatory and Legislative Changes

    • Government set to publish Environmental Improvement Plan
    • FCA set to clamp down on greenwashing in investment industry…
    • … and moves to boost transparency over ESG data and ratings providers
    • HSBC climate adverts banned by ASA for omitting fossil fuel investments
    • The FCA’s Consumer Duty will have implications for sustainability claims
  7. Competitive Strategies and Launch Activity

    • HSBC moves to end new oil and gas investments
    • Barclays sets $1 trillion sustainable finance target by 2030
    • Banks are increasingly offering recycled and virtual bank cards
    • Santander pilots bank card recycling scheme
    • TreeCard set for full launch in 2023
      • Figure 14: TreeCard’s wooden debit card
    • Tred looks to the fee-paying sustainable account market
      • Figure 15: Tred banking app
    • Ethically-focused digital bank Kroo gains banking licence
    • Triodos receives ‘Best Buy’ award from Ethical Consumer magazine
    • Impact Cubed launches validation and climate tools for investors
    • Ethereum moves to make cryptocurrency more energy efficient
  8. Environmental Concerns

    • Climate change tops consumer environmental concerns
    • Ozone layer improvement highlights the potential for change
      • Figure 16: Environmental concerns, 2022
    • All age groups are showing concern over environmental issues
      • Figure 17: Environmental concerns, by age, 2022
    • Consumers in cities are more concerned about air quality
      • Figure 18: Environmental concerns, by location, 2022
  9. Perceptions of Sustainability

    • Retail banking brands are viewed positively on sustainability
      • Figure 19: Perceptions of organisations impact on the environment, 2022
    • Digital banks are ahead in perceived sustainability among younger consumers
      • Figure 20: Perceptions of high street banks’ impact on the environment, by age, 2022
      • Figure 21: Digital banks’ impact on the environment, by age, 2022
  10. Researching Banks’ Environmental Records

    • Consumers lack trust in sustainable banking information sources
    • Media sources are severely lacking in trust
      • Figure 22: Researching banks’ environmental record, 2022
    • Older consumers look to regulator for reliable environmental information
      • Figure 23: Researching banks’ environmental record, by age, 2022
    • Banks must use the growing environmental concern to expand green products
      • Figure 24: Switching/closing accounts due to environmental records, by age, 2022
  11. Trust in Environmental Claims

    • Financial providers need consistent and transparent messaging to build trust
    • There are opportunities for providers with sustainability at their core
      • Figure 25: Trust in financial providers’ environmental claims, 2022
  12. Importance of Environmental Credentials in Banking

    • Offer sustainable accounts to attract switchers
      • Figure 26: Importance of environmental credentials in banking, 2022
    • Use sustainable accounts to attract younger consumers
      • Figure 27: Importance of environmental credentials in banking, by age, 2022
  13. Important Environmental Factors when Choosing Bank Accounts

    • Banks must highlight efforts to support renewable energy projects
    • Use rewards to incentivise sustainable purchasing
      • Figure 28: Important environmental factors when moving bank account, 2022
    • Boost sustainable investment options to attract older consumers
      • Figure 29: Important environmental factors when moving bank account, by age, 2022
  14. Attitudes towards Sustainability in Financial Services

    • Consumer desire for convenience leaves the sustainability onus on providers
      • Figure 30: Attitudes towards sustainability in financial services, 2022
    • Consumers need help gauging sustainable financial providers
      • Figure 31: Understanding the impact of banks on the environment, by age, 2022
    • Reward data-sharing with eco-spending guidance and rewards
      • Figure 32: Sharing financial data for environmental spending guidance, by age, 2022
  15. Sustainability and the Rising Cost of Living

    • Help consumers to save money while saving the planet
      • Figure 33: Sustainability and the rising cost of living, by age, 2022
    • Target affluent younger consumers in cities with sustainable accounts
      • Figure 34: Sustainability in Financial Services – CHAID – Tree output, September 2022
  16. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
  17. Methodology – CHAID

      • Figure 35: Sustainability in Financial Services – CHAID – Table output, September 2022

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.

Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.

*databooks not available with UK B2B Industry reports.

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