Sustainable innovation and conscious customers are changing the rules of the payments industry
By favoring eco-responsible solutions for the payment chain, banks can help reduce the pressure on our planet’s resources and simultaneously better align themselves with the expectations of their customers.
From linear thinking to circular thinking
For many years, the global economy has been dominated by a take / make / dispose paradigm, the âlinear economy,â in which our planet’s resources are viewed as endless. A striking example of this attitude is that only 9% of the 89 billion tonnes of material mined from the Earth each year is recycled. Today, single-use plastics represent 40% of global plastic production. As a result, plastic pollution has become one of the world’s most pressing environmental issues, as the increasing production of disposable plastic products exceeds our ability to cope. Yet plastics remain the raw material of the modern economy and ubiquitous in our everyday life. Despite growing awareness of this problem, plastic production is expected to triple over the next 30 years, ultimately resulting in more plastic than fish in our oceans.
Faced with this, it is clear that the only way to slow down this development is to change economic models, behaviors and consumption models and that rethinking the future of plastic is one of the main challenges of the 21st century. Changes to plastics and plastic recycling will have a major impact on preserving the environment by saving landfill space, reducing oil consumption, saving energy and reducing emissions.
The urgency of these changes is underscored by the call for sustainable solutions heard around the world, from powerful organizations such as the UN to individual consumers, and spurred by the acceleration of climate change. The linear take / do / eliminate model is being challenged and slowly but surely replaced by a reduce / recycle / shift way of thinking.
Embrace consumer-driven changes
In addition, today’s consumers are more motivated than ever by their values. They want products that are compatible with their lifestyle and engage with organizations that share their values. And they’re often willing to pay more for a product that matches their values. A Cone / Porter Noveli study found that 79% of Americans are more loyal to goal-oriented brands whose values ââthey share. On environmental issues, a strategic guide from Nielsen indicates that 81% of global consumers think it is extremely important that companies implement environmental improvement programs and that 73% would change their consumption habits to reduce their impact on the environment.
A solid argument for greener payment solutions
These changes are also affecting the world of payment solutions. A global Dentsu survey showed consumers are aware of payments, with 87% expecting their banks to offer environmentally friendly cards. In fact, 62% would even consider switching to an eco-responsible bank. Moreover, as mentioned above, products with an environmental benefit can often justify a higher price: the survey showed that 74% of the millennials in the world, who are the primary source of income, expenditure and creation wealth in the world since 2015, would accept a monthly supplement for a âgreenâ card.
At the same time, the payment card has arguably become the last physical point of contact between card issuers and their customers, as bank branch visits and paper account statements have dramatically decreased or disappeared altogether. In light of this, the big and the FinTechs have realized how the physical card is a great marketing tool (âa marketing and branding moment that is played out every time a customer takes out their cardâ), and lead the way by leveraging the payment card with innovative materials with revolutionary designs. At the same time, consumers increasingly see their cards as accessories and an extension of themselves. Therefore, given the high visibility of the payment card and its prominent position as the bearer of the bank’s identity, an environmentally friendly card will increase the value of the brand in the eyes of concerned consumers. the environment.
Enabling an end-to-end green payment chain to support banks and other card issuers in this transformation, IDEMIA has developed the GREENPAY card range, in recycled PVC which passes all ISO tests to guarantee the same level of quality and durability than first use PVC. These cards are fully available today, and the next generation, which will use bio-based materials to eliminate dependence on fossil fuels, is in the works. The migration from first-use plastic to recycled plastic has three main advantages: 1 Less natural resources have to be extracted 2 Landfill space is reduced 3 Reduction of the carbon footprint of payment cards.
A holistic and environmentally friendly approach Environmental issues are eminently global and cross-cutting. Beyond the payment card itself, environmentally conscious customers now expect green initiatives along the payment value chain. For example, 65% of consumers expect banks to offer digital alternatives to paper documents, and 71% think banks should offer a service for recycling expired payment cards.
Now is the time for change Today, going green is no longer an option, for the banking sector as for all other economic sectors. Banks and other card issuers who are contributing to the transition from a linear to a circular economy are not only assuming their responsibility from an ethical point of view, they are also aligning themselves with the expectations of their customers, who will decide in fine which brands flourish or wither.
Matthew has spent most of his 30-year career defining corporate and brand positioning strategies and maximizing the competitive distinctiveness of large multinational brands. Matthew has been Executive Vice President Global Branding & Communications of IDEMIA since its inception in 2017, and is part of the IDEMIA Executive Committee. In addition to this role, he was appointed Regional President of India in early 2021 for amplify IDEMIA’s substantial investment in India. Matthew is based in Delhi, India. Matthew has extensive experience working with multinational companies serving both the government and enterprise technology sectors. Matthew is passionate about building teams to drive growth.
Thanks for reading the column. Please drop us a line and help us do better.