Fintech & Ecommerce

Are some payment methods more sustainable than others?

Sustainability is a subject that has grown increasingly important in business over recent years and is something we all hear about a lot more. As a result, the majority of organizations will have their own formal plan around operating in a more environmentally responsible manner.

Are some payment methods more sustainable than others?

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The importance of sustainability for business is hard to overstate and this makes it something firms in all sectors are looking at more closely. This is not only due to their own desire to operate in a more considered way but also due to the demand consumers place on them in this area. Although most people are common with familiar issues for sustainability (such as how much waste a company produces), there are other key things that can have an impact.

Payment methods key

Payment methods are a great example and are something that we all make use of on a daily basis to buy goods or pay for services. In terms of business, payment methods are also something most firms use each day to allow customers to buy things from them. Although we might not think too much about how we make payments, the method we choose or that businesses use can have a big effect on sustainability.

But are some payment methods better than others to use?

Paper money

Paper money has been around for a long time and is still used widely around the world. But is it a sustainable source of purchasing power?

The simple answer is that it isn’t very sustainable and is arguably the poorest choice to make. This mainly comes down to the huge amounts of energy, paper and metals used to make paper money. Although newer polymer-style bank notes are more recyclable, they can also be more harmful to produce in terms of CO2.

Credit and debit cards

While paper cash might be fading into the background for payments, using a credit or debit card to buy things is still going strong. But is this any better for sustainability overall?

In one way, it is an upgrade on paper money. As it uses online tech and point of sale terminals to take payments, physical money is not needed at all. This naturally reduces the amount of paper money needed to be made and helps protect the planet.

The problem with debit and credit cards lies with the cards themselves. These small pieces of plastic need to be produced in huge numbers and use up lots of energy and resources as a result. When you think of how many new cards are produced each year or how many replacements are required for expired cards, you can understand the issue.

Digital payment methods

Recent times have seen massive strides being taken towards true digital payment methods. As the name implies, these options do not need paper cash or plastic cards to use. This means they are far better in terms of sustainability and have less impact on the environment.

Mobile payments are a great example of this and enable you to use a virtual wallet app on your mobile device to pay digitally for goods. The added bonus with this is that you can use your existing mobile device to do this and do not have to purchase any separate tech for it.

E-wallets are another good example of a digital payment method to know about. Common examples like PayPal exist purely online and do not need paper money or plastic cards to use. They are also quick, simple and convenient in terms of making payments.

What about cryptocurrencies?

This form of money is big now and sees people hunting out the latest cryptocurrency news to take in. This makes it hard to mention digital payment options without crypto coming up in the conversation.

In addition, more businesses and consumers are starting to look at this as a more sustainable option, as it exists purely online. As a de-centralized form of currency that aids financial inclusivity globally, many also prefer it from an ethical point of view.

It has to be said, though, that cryptocurrencies have come in for criticism for the energy that large mining farms can consume to produce coins. While water for cooling machinery and electricity to run them is required in varying amounts, this can be offset in many people’s eyes by the reduced impact it has environmentally in other areas (such as not needing to use resources to produce paper cash for each crypto coin).

Payment methods and sustainability – which come out on top?

All businesses and consumers are focusing on sustainability in the modern world. While this might be seen in various ways, how we pay for things and how companies accept these payments can make a real difference. Although there are a number of ways to go about this now, digital payment methods do seem to offer the most in terms of being sustainable.

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