Most consumers are willing to pay more for green finance products
- Media Manager
- May 2, 2023
- 1 min read
Tearsheet
Written By: Rabab Ahsan
Published: May 3rd, 2023
Consumers are willing to put money where their convictions are when it comes to combatting the climate crisis.
However, limited understanding of product offerings and inability to differentiate in green financial products may be leading to an intention-action gap.
As the realities of climate change are setting in, customers are becoming interested in products that help combat the climate crisis and financial products are no different. However, recent research by McKinsey shows that although consumers are interested in green financial products, their understanding of different product offerings by different banks is low.
Motivation to make banking greener is about to hit the halfway mark as 40% US consumers report interest in choosing climate-linked financial products such as a green checking or a climate screened index fund. Moreover, consumers are willing to put their money where their convictions are with two in three saying they would assign more than 40% of their savings or monthly credit card spending to a green retail banking product.
Make money matter
Nearly 40% of consumers said they would opt for a green savings account with an annual percentage yield (APY) that was 20% lower than a traditional savings account, according to McKinsey. If such cases ensure a positive impact on the climate, consumers say they will be willing to pay more or compromise on savings. The findings of this research confirm previous research results which show that when customers trust they are making a positive impact on the climate crisis they are more likely to compromise on issues like price.
