The role of banks in driving carbon literacy

This lack of understanding fuels the intention-action gap, where people express concern about climate change and a willingness to act, but their choices don’t align. Consequently resulting in people prioritising low-impact actions, like recycling over more impactful decisions like cutting back on air travel or reducing meat consumption. While some decisions are shaped by situational or psychological factors, others come down to a simple lack of awareness about which actions make a difference. 

At Cogo, improving carbon literacy is at the heart of what we do. We believe that when people gain the knowledge and confidence to make more sustainable choices, they align their actions with their values. And when one person changes their behaviour, it often inspires others to do the same, creating a ripple effect, that can lead to collective change. 

What role do banks play in improving carbon literacy?

Every purchase we make—whether buying new clothes or commuting—has a carbon impact. Yet our research shows that only 43% of mobile banking users recognise that their spending choices affect the environment, highlighting a lack of awareness. This isn’t surprising, given that carbon emissions are invisible, and unlike price tags or nutritional labels, people rarely receive information about the environmental impact of their purchases. 

Banks have the power to bridge this gap. With a comprehensive view of customer spending patterns—something no retailer or app can match—banks are uniquely positioned to help customers understand the carbon footprint of their financial choices. By integrating carbon insights into the banking experience, they can empower customers to align their spending with their values and improve their carbon literacy.

Some may question whether this should be a bank’s responsibility. However, banks play a critical role in shaping the economy through their lending and investment decisions. By embedding carbon insights, green investment options, and responsible lending practices, they can drive real-world impact at scale. 

Research also shows that customer demand for sustainable banking is on the rise. Over 70% of consumers expect their banks to support them on their sustainability journey, and more than 60% are willing to switch providers if they fail to meet these expectations. Clearly, offering carbon insights isn’t just about climate responsibility—it’s a strategic opportunity for banks to attract and engage customers. 

Supporting business banking customers 

Small business owners are also under increasing pressure to measure and report their carbon emissions. But, the complexity of climate jargon and regulations makes it really difficult for SMEs to know where to start.

Banks can support business customers by integrating carbon insights into business banking platforms, helping SMEs understand their carbon footprint, identify ways to reduce emissions and simplify reporting. 

But carbon literacy isn’t just about learning how to reduce emissions—it’s about improving efficiencies and cutting costs too. When business owners and employees understand the carbon impact of their operations, they can spot opportunities to reduce waste, optimise energy use, and streamline processes—ultimately improving their bottom line.

By supporting business banking customers in building their carbon literacy, banks aren’t just helping them become more sustainable—they’re also enabling them to operate more efficiently, reduce costs, and meet  regulatory expectations. In turn, this strengthens  relationships and reinforces the bank’s role as a valuable partner in the transition to a low-carbon economy.

How Cogo supports banks in improving carbon literacy 

At Cogo, we help banks integrate real-time carbon insights into their digital experiences, making carbon emissions visible, understandable, and actionable. By embedding these insights into everyday banking, we enable both individual and business customers to understand the carbon footprint of their spending and gradually build carbon literacy through repeated exposure. 

For individuals, seeing the carbon impact of their purchases in their banking app makes carbon literacy a natural part of their financial decision-making process. When users compare transactions side by side, they start to understand the differences in emissions between choices: 

• Public transport (TFL): £6.20, 3 kg CO₂e
• Petrol station (Shell): £20.00, 37 kg CO₂e

But visibility alone isn’t enough. Personalised recommendations play a key role in guiding customers toward more sustainable choices. One of the biggest challenges with sustainability messaging is that it’s often too generic—advice like "take more public transport" is irrelevant to someone who already cycles to work. By tailoring recommendations based on real behaviour, banks can provide more relevant and engaging support. 

For SMEs, carbon literacy is just as important, but the challenges are different. Many small businesses are still early in their sustainability journey and need support to understand their emissions before they can commit to detailed carbon reporting. Cogo makes this process simple by automatically generating an organisation footprint using spend data, in a matter of minutes. This gives SMEs an easy starting point to understand where their emissions come from and what steps they can take to reduce them, before investing significant time and effort in collecting granular data. We help businesses bridge the knowledge gap by: 

• Clarifying complex concepts through simple content and FAQs
• Highlighting carbon hotspots to show where emissions are highest
• Providing industry benchmarks so businesses can see how they compare

Want to see this in action? Request a demo to explore how Cogo can help your bank drive carbon literacy and empower customers to make more sustainable choices.

‍Also, keep an eye on our page—we’ve got a new feature announcement coming soon, designed to further support small businesses in improving their carbon literacy!