The Green Revolution: How Sustainable Cards Benefit Both Banks and Consumers

In the first blog in this series, I gave an overview of the environmental issues facing the payments industry. In what follows, I’ll outline the impact cards have on the environment, and look at steps banks are taking in partnership with companies like ours to limit this impact.

A study conducted by DNB Bank in the Netherlands quantifies the environmental impact of payment cards as coming from payment terminals, data centers and payment cards themselves¹. Terminal hardware is the biggest contributor to our industry’s environmental impact, accounting for approximately 75% of our total impact given its use of rare earth metals (mining), chips and other materials to fabricate the terminals. With the advent of “softPOS” systems on mobile devices, it’s possible that this impact will be reduced over time as fewer organizations purchase or rent static POS terminals.

Data centers are responsible for processing transactions and contribute approximately 11% of our total environmental impact. At Tietoevry, our data centers are run on 100% renewable energy in Norway – one example of how data center operators across Europe and further afield could seek to reduce their impact.

Card materials – cutting the environmental cost

Physical payment cards add approximately 15% of the overall environmental impact of our industry once the plastic card bodies, antennas and microchips used on smart cards are taken into account. This area is one in which we can have a direct and immediate positive effect by choosing different materials for card production. What’s more, with more than two-thirds of consumers expecting their bank to take action on environmental degradation according to a 2021 survey from Meniga, choosing sustainable cards is great for business¹.

Options for banks to consider include recycled cards made from recycled polyvinyl chloride (rPVC) or polyethylene terephthalate (rPET); renewable cards made from Polylactic acid (PLA), a biodegradable material typically made of corn starch, and so-called “reclaimed” cards made from plastics collected from the ocean. Other options include wooden cards. At Tietoevry Banking, we’re the world leader in sustainable card production, with 75% of our total production in 2023 made from sustainable materials.

Changing from traditional polyvinyl chloride (PVC) plastic to any of the above-mentioned materials will reduce any individual card’s carbon footprint by between 30 and 75%, according to scientific studies from Mastercard. Card issuers can also further cut their carbon footprint by using local manufacturers wherever possible, maximizing the batch size they use for production, using sustainable inks for card design, and cutting the use of paper in customer communication.

A huge majority of our client banks have woken up to the need to do more for the environment, as growth in our production of sustainable cards shows. Next time, I’ll look at strategic and operational changes banks can make that have further positive effects in reducing the impact our business has on the global ecosystem.

For a discussion about improving the sustainability of your bank’s card programme, get in touch with Tapio Vailahti!