Choosing any credit card first involves understanding why you need a credit card and what you plan to use it for. If you want to earn rewards, you may need to analyze your spending habits and budgets to determine which bonus categories you spend the most in and find a card catering to those habits.
For those in need of low introductory APR periods and balance transfers, you’ll need to calculate the total amount you need to pay off and how long it will take—carrying a balance beyond an introductory APR period is highly inadvisable due to the possibility of retroactive interest.
Applicants with low or no credit may be interested in secured cards, student cards or other cards designed for those building credit and should understand the ins and outs of using credit cards to establish, build or repair credit.
Benefits are important too: which insurances or coverages might you be interested in receiving as an added perk with your card? Do you want online banking or the ability to use autopay? Convenience benefits can make your life easy or miserable when it comes to remembering to pay on time every time—something everyone should always strive to do, if possible. If you’ll occasionally need to carry a balance, seeking cards with the lowest possible APR is a better money move than focusing on rewards, benefits or welcome bonuses.
After figuring out what kinds of cards you might want or need and what your personal financial priorities are, you can focus on finding the ideal card for you from an issuer whose investment and business priorities align with your personal preferences.
Pick an Eco-Friendly Issuer
The private banking industry may be financing many sustainable or renewable energy projects, but let’s not forget many institutions also earn money on credit card transactions and on other financial products while simultaneously funding industries and companies severely impacting the environment.
Some of the banks we write about most often here at Forbes Advisor for particularly attractive credit card offerings have the biggest investment in fossil fuel industries: JP Morgan Chase, Citibank, Bank of America and Wells Fargo reportedly lead the world’s banks in investment in oil and gas industries. (Unfortunately for those seeking eco-friendly cards, these institutions also offer many of the best credit cards on the market).
You can limit the risk profits made on your transactions might fund or support fossil-fuel-inclusive investment portfolios by using a credit card from a more eco-friendly issuer. Banking locally with smaller banks and credit unions is one solution. Check out our lists of the best credit unions and research each institution nearest you for commitments to fossil-free investments and certifications or memberships from or with programs like B Lab’s B Corporation status, the Global Alliance for Banking on Values (GABV) Membership and more.
B-Corp Status, GABV Membership, 1% For the Planet and Fossil-Free Programs
Many corporations try to prove efforts toward sustainability to their customers, but consumers may not always know who or what to trust. Some banking institutions’ attempts at transparency lead them to partner with or enlist the services of third party organizations designed to ensure accountability in the form of private certification.
Among these is B Labs, a nonprofit promoting the idea business can be “a force for good” with its assistance helping companies “meet high standards of social and environmental performance, accountability, and transparency.”
Global Alliance for Banking on Values
Several smaller banks and credit unions across North America have joined the Global Alliance for Banking on Values (GABV), which purportedly holds its members to a number of socially-conscious environmental and transparency standards.
1% For the Planet
The 1% For the Planet organization is a non-profit monitoring and certifying businesses dedicated to contributing at least 1% of profits toward planet-helpful organizations or activities. Some banks, including at least one on our list above, participate.
Bank.Green’s Fossil-Free Banking Alliance
Several institutions, including Beneficial State Bank, Atmos and Amalgamated Bank, have pledged not to invest in fossil fuels at all through the Fossil-Free Banking Alliance. These banks receive certification through self-declaration via Bank.Green.
Beware of Greenwashing Banks
There’s a long history of corporations telling individuals to fix climate change with individual choices; that the consequences of profiteering from the environment should be shouldered by each of us individually, whether each of us gained in a direct financial way or not. Much of the marketing around financial products may reflect “greenwashing” or PR-friendly token gestures towards the environment.
When it comes to which banks fund fossil fuels and which banks don’t, consumers may find it difficult to suss out the truth. For example, BNP Paribas (which owns Bank of The West in the U.S.) pledged exit from coal, announced exclusion of investment to specific Arctic and Amazon-area oil and gas drilling and made commitments toward net zero initiatives, yet has since reportedly increased its fossil-fuel development investments. Bank of the West, meanwhile, published what appears to be a PR campaign to promote it and its parent company’s progress with statements including: “Our low-carbon future depends in part on banks not making the climate crisis worse by underwriting carbon-intensive industries” and advertises a 1% for the Planet Mastercard Debit Card with carefully-worded promises about what specific types of fossil-fuel investments cardholder deposits won’t be used to fund. Which narrative should you believe?
Temper Your Expectations
To be clear: no card we mention or include here is without issue, so take our advice with a grain of responsibly-sourced sea salt: Our suggestions may encourage better and greener options than most of what exists on the market today, but because all these cards function as products of an economic system inherently and historically connected to climate damage, none are perfectly “green.”
This said, forgoing personal finance products and switching immediately to a system of bartering with neighbors for everything we need likely doesn’t seem quite achievable for most of us. Choosing a card from a greener institution presents a step many of us can take in the near future—at least until other blockchain-driven solutions or real-time payment systems find a more energy-efficient way to deliver faster secure payments.