Fintech is an industry characterized by innovation, allowing it to spread to industries beyond the traditional finance remit.
This has enabled the creative fintech entrepreneurs to pursue environmental aspirations by contributing to the world of green finance.
Green finance can be defined as any financial activity that has been created to ensure a better environmental outcome. This can be loans, debt mechanisms or investments that encourage the development of green projects or minimize climatic impact of regular projects. Green finance is particularly important to the United Nations for example, as it helps them to achieve their Sustainable Development Goals.
Typical green projects may include:
Renewable energy and energy efficiency.
Pollution prevention and control.
Circular economy initiatives.
Sustainable use of natural resources and land.
Fintech is becoming a key player in the growth of green finance capabilities. Some of the advantages of digitising financial and payment technology will be familiar, with the rise of mobile banking and paperless options reducing resource consumption. Natwest bank for example, regularly printed more than 450m sheets of paper and 100m envelopes before going paperless, a huge saving in both environmental costs and printing costs.
Covid-19 contributed to this rise in particular with a 200% increase in new mobile banking registrations in April last year, with mobile banking traffic rising 85%, according to Fidelity National Information Services (FIS). In a recent survey by Fintech company Novantas, only 40% of respondents said they expect to return to branches post-Covid, indicating the convenience of Fintech is encouraging users to contribute towards a greener economy.
Similarly, Fintech apps like digital wallets hold debit or credit cards securely on your smartphone, reducing the demand for metals such as nickel or copper used in coin production. Apps such as Alipay’s Ant Forest gamify carbon footprint tracking, encouraging users to use lower-carbon activities to grow their virtual tree on the app. These virtual trees are then converted into a real tree being planted in the desert in Inner Mongolia, to aid in a government project fighting desertification in the region.
New cryptocurrency ideas have also been implemented to aid in the growth of the renewable energy sector. SolarCoin, started in 2014, is tied to the production of solar energy within it’s financial community, the more solar energy you produce, the more SolarCoins you receive. A renewable energy backed currency is a great incentive to convince people to invest in clean energy, and such a currency system could completely change what we value in future.
Blockchain also provides a natural fit for green finance, allowing users to track where money has come from and what it has been used for, in line with environmental and ethical principles. Aaron McCreary, climate fintech lead at New Energy Nexus, believes that the interest in environmental Fintech based initiatives has grown so much that it should be classed as it’s own industry. He goes on to define ‘climate fintech’ as “digital financial technology that catalyses decarbonisation”. With over 250 companies worldwide and growing, this is certainly the time to invest in a career, that can not only pay you well, but pay the planet back too.
A career without limits
With a clear financial model and key incentives for consumers, a career in Fintech can align with any goal, whether it be to further efforts towards a greener economy, reduce poverty or end world hunger.
Indeed, Fintech is already tackling these issues with well known success stories such as M-Pesa able to lift nearly 200, 000 households out of extreme poverty. Other projects such as Cellulant’s Agrikore and Tingg Marketplace, aims to “solve food crises and hunger in Africa” according to Co-CEO Bolaji Akinboro. It aims to provide a fair and safe market for farmers, community produce aggregators and commodity buyers to do business.
The freedom afforded by financial technology is limited only by the creativity and ingenuity of those willing to make their dreams reality. If you are looking to take the next step in your career, connect with Headcount, the number one recruiter in payments and fintech. Send us your CV or apply now for one of our live job offers.