Are green credit cards really good for the environment?

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Sustainability includes a number of options that add up over time: a reusable water bottle, a ride on public transport, a trip to a consignment store instead of a department store. But how we pay for everything we buy also influences. In recent years, green credit cards have emerged as a way to make another informed choice.

These cards can be geared towards environmental goals, help you offset your carbon footprint, or even be made from recycled, biodegradable, or recycled materials. But a credit card that is “good” for the environment is no easy task. First, many large banks, some of which issue these cards, are investing in fossil fuels.

A plus, credit cards make it easy to buy more thingsand the very act of consumption contributes to climate change in many ways. After all, this online purchase doesn’t just magically appear at your front door. The goods you buy are produced, packaged, shipped, trucked … you get the idea.

So do green credit cards matter? What other actions can you take to change your own consumption habits?

What makes a credit card “green”?

Eco-friendly credit cards are designed to help the environment in several main ways:

Using more sustainable materials for making postcards

There has been a marked push away from “first-use” plastic in credit cards and towards plastics that used to serve other purposes, such as recycled PVC (polyvinyl chloride, the hard-to-recycle material that cards are traditionally made from) and plastic. recovered from the oceans.

Also see: How to Find the Best Credit Card for International Travel

However, any use of plastic, even recycled or recycled, can be problematic, according to Katie O’Hare, conservation manager at the Marinelife Loggerhead Center in Juneau Beach, Florida.

“Anything made from recycled or reclaimed ocean plastic is really not recyclable or environmentally friendly,” she said in an email. “When plastics are recycled, they decompose, releasing nano and microparticles into the water used to recycle them. Plastic cannot be reused more than one or two times, and when it is recycled it is still harmful to the environment. ”

Even if plastic finds a second life as a credit card, it will eventually go back to the landfill. O’Hara recommends choosing metal credit cards that are more durable and easier to dispose of.

Donation for specific purposes

There are many worthwhile environmental charities doing important work around the world and need help. And under “help” they really need money.

“Environmental nonprofits rely heavily on donations, and the donations they receive through green credit cards can be a vital financial channel for them,” said Mark Lewis, executive editor of EcoWatch, an environmental news and product review site, at email. …

Therefore, if you want to use a credit card that helps raise money for a cause that you care about, do so. But don’t fall into the trap of thinking that using the map more often means a healthier planet. “It’s hard to measure whether these donations really offset the huge carbon footprint of credit card purchases of TVs, smartphones, new furniture and other resource-intensive consumer goods,” Lewis said.

An alternative is to donate directly to charity. Money always fits, but you can even donate points and miles on bonus credit cards, as well as on airline and hotel loyalty programs.

We offer carbon offsetting

With carbon offset, you are essentially helping finance a green project somewhere in the world, offsetting the carbon footprint of your own actions. In recent years, several carbon offset credit cards have entered the market. They partner with organizations that offset the carbon footprint of your purchases through reforestation and other means. Some even track the carbon footprint of your purchases, helping you make more informed purchasing decisions.

See: Who’s Right About Climate Change? Greta Thunberg or Bill Gates?

Anything that helps you think about the impact of your purchases is good. Carbon offsets themselves can also help, although data on the effectiveness of various offset programs is unclear. If you choose a credit card that offers carbon offsetting, research the organizations they support to see what impact you can have. It is also tempting to buy more when every press of the card benefits the environment, but again, buying more items is generally not ideal for the environment.

What Card Issuers Can Do: Ditch Physical Cards Altogether

According to Doug Heske, CEO of Newday Impact Investing, a platform that allows users to invest in ESG Portfolio… (ESG stands for Environment, Social and Governance.) But we already have technology that will reduce the demand for physical cards.

Read also: These radar-hidden stocks are fighting climate change by cutting carbon emissions.

Perhaps partly due to COVID-19 pandemic, the use of contactless and mobile payments is gaining momentum around the world. Visa 2021
V,
+ 1.34%

The study found that 85% of consumers expect digital options when they shop in person, including contactless credit cards, mobile payment apps, and mobile wallets. And if customers want contactless payments, card issuers and merchants will eventually fulfill them, allowing consumers to choose to receive physical cards instead of sending them out automatically.

“We are in a transition period between what was and what will be,” says Heske. “My experiences and conversations with major service providers show that everyone is moving in this direction. It will be consumer-oriented. “

What consumers can do: make small choices that add up

Just because something is plastic doesn’t mean you can just throw it in the trash and pat yourself on the back. What is considered “recyclable” may depend on the rules of the recycling program in your area.

Credit cards are difficult to recycle in part because of their chips and magnetic stripes, according to Debbie Prenatt, marketing manager for sustainability at M. Holland Co., a plastics distribution company. Companies like TerraCycle offer a way to recycle your old cards. TerraCycle’s Zero Waste Pouch is $ 48, but you can save money by sharing the cost and bag with friends who also want to safely dispose of their cards.

Connected: Coca-Cola, Nestlé and Pepsi top the list of plastic offenders, and Sweden has made a breakthrough in solar power.

And if you haven’t tried this mysterious wallet app on your phone yet, add a credit card or two and try it next time you shop with a merchant who accepts this type of payment.

Of course, much of the reduction in plastic waste is simply less use of it. Prenatt adds another R to cut, reuse, recycle – refuse.

“If you buy food to go, do you need plastic dishes? Or can you wait until you get home and use a metal plug? This is how you refuse, ”she says. “Unfortunately, if you want to be more successful, you have to do the work individually.”

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Sarah Ratner writes for NerdWallet. Email: srathner@nerdwallet.com. Twitter: @sarakrathneR.

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