The best climate-friendly banks in 2022

By now you’ve probably heard the news: most banks use your money to fund fossil fuel projects. In fact, here’s how much the top 5 worst offenders lended to fossil fuel projects between 2016-2020 according to a recent report:

• JP Morgan Chase: $316 billion
• Citi: $237 billion
• Wells Fargo: $223 billion
• Bank of America: $198 billion

But despair not, internet stranger: there are banks you can sign up for that use your money to fund climate solutions like rooftop solar, electric vehicles, LED lighting, and my favorite boring climate solution of them all, heat pumps (and, of course, their trusty-side kick, the heat pump water heater).

Last month I set out on a journey to move me and my wife’s money to one such bank.

Because I’m both a climate and personal finance nerd, I spent an absurd amount of time doing research on, testing, and vetting every sustainable bank out there. In total I looked at more than a dozen options and actually signed up for 4 of them to test the user experience.

I’ve broken this article into two sections: in the first section, I’ll run through my process and how I tested each bank. If you too want to overthink and analyze the crap out of this decision like me, you might enjoy reading that. But if you just want to pick a bank and move on, skip that section to read my reviews and recommendations in the second section. Or check out the two minute version below.

The two minute version of what I learned

If you only have a few minutes, here’s the short version of my recommendations and what I learned:

• I switched to Ando because 100% of deposits go to climate solutions and they had the best sign up and user experience. The only thing I didn’t like about Ando is the fact that they don’t have a web version and they don’t offer joint accounts.
• I also liked Atmos and Clean Energy Credit Union. Both of these banks invest 100% of deposits in climate solutions. But I ran into a few issues during the sign up process which ultimately turned me away.
• The only option I really didn’t like was Aspiration. None of the deposits fund climate solutions. And their idea of impact is reforestation offsets that have time and time again proven to be ineffective. Big thumbs down here.

How I evaluated and tested the banks

Choosing a bank is no small decision. Choose poorly and you end up with a bank that sticks you with fees and makes you come into a branch to sign paperwork. When I was younger I chose one such bank and I can confirm it was a terrible experience. In embarking on my divestment journey, I didn’t want to make that mistake again.

So when I finally decided to make the switch I thought I’d do my due diligence.

To start, I spent a few hours looking for the most sustainable banks. I asked climate-concious friends for recommendations, crowdsourced feedback on Twitter, and trawled Google. I found about a dozen options. Then I read annual reports from each banks (when they were available) and talked to executives at the company to understand what my deposits would fund. From this research I whittled my list down to 4 options:

• Clean Energy Credit Union
• Ando
• Atmos
• Aspiration

I signed up for accounts with each bank and transferred money into them in order to test the user experience. (I probably raised some eyebrows at the FBI in the process).

For each option I looked for the following:

• FDIC insurance — If the bank goes under, what happens to my money?
• Encryption and security — What steps does the bank take to protect my personal information?
• Climate impact — What does my money fund?
• User experience — How easy or difficult is it to sign up for an account, transfer money, send checks, etc.
• APY rate — How much does the bank pay me to lend my money?
• Integrations — Does the bank work with Mint, Venmo, and other apps I use?
• Joint accounts — Can my wife and I share a single account?
• Diversity, inclusion, and climate justice — Does the bank have a diverse leadership team and thoughtful approach to climate justice?

So without further ado, here is what I learned:

The best climate bank: Ando review

The bank I liked the most was Ando. Like Clean Energy Credit Union and Atmos (my 2nd and 3rd favorite options), 100% of deposits fund climate solutions (some of which have a climate justice angle). But where Ando really shines is the user experience. It took me about 10 minutes to sign up for an account and get approved. And the whole app is just really slick.

The two biggest drawbacks were: 1. They don’t offer joint accounts, and 2. They only have a mobile app, which for an aging old millennial like me is annoying.

What I liked

• Climate impact — 100% of loans go to climate solutions like rooftop solar, EVs, electrification, energy efficiency etc. That means your money helps accelerate the energy transition.
• Good user experience and design — It took me less than 15 minutes to sign up and link my bank account. And overall it just feels like a nice modern experience.
• No branch, no paperwork — Ando doesn’t have any physical locations. That means there’s zero chance they’ll make you come in to sign paperwork like traditional banks (cough, Chase, cough).
• FDIC-insured — Like many “neo-banks” Ando partnered with a traditional bank so that all deposits are FDIC-insured up to $250,000. If you have more than that in your savings account, you should be more worried about inflation eating that money than a banking crisis wiping out any of your money beyond the $250k.
• No fees or minimums — They claim that there are no account minimums, monthly fees, or overdraft fees. As someone who has been hit with a lot of fees in my youthful, naive banking days, I can confirm this is a nice feature.
• 34,000 no fee ATM network — I think I’ve only used cash a handful of times since the pandemic, but in the past I used to spend about a hundred bucks per year on ATM fees. They’re no fun.
• Send checks from your phone — I haven’t written many checks in my life, but when I have it hasn’t been fun. In the Ando app you can enter someone’s address and the amount you want to send and they’ll write the check for you.

What I didn’t like

• Mobile-first is actually mobile-only — Ando doesn’t let you log into your account from a computer. Given I do my monthly personal finances on my computer, that’s annoying.
• No joint accounts — I’m sure Ando is working on changing this, but for now they don’t offer joint accounts. And because they use two-step verification and a mobile-pin it’s hard to imagine how I could share an account with my wife.
• APY fine-print shenanigans — On their website Ando claims to offers an industry-leading 5% APY. But in order to get it you have to invite 5 friends. And once you do that you’ll only get 5% on the first $5,000, which works out to about $250 per year or $21 per month. Those caveats are in size 6 grey font at the bottom of the website. Personally I find these types of fine-print offers misleading and dishonest.
• No Mint integration — Unlike our local credit union and Aspiration, CECU doesn’t integrate with Mint. Considering I’ve used Mint every month for 6 years, this is a big bummer. But in Mint you can manually add the amount in any account so this isn’t a deal breaker for me.

The best climate credit union: Clean Energy Credit Union review

Clean Energy Credit Union came in a close second. Like Ando, 100% of deposits fund climate solutions. The organization is also women-led and recently took steps to increase the diversity of its board (two rarities in an industry that has a bad track record on this front).

But it took more than a week for me to get approved for an account and, of all the options I looked at, the sign up experience felt more like a traditional bank than a neo-bank like Ando.

If you like the idea of supporting a local credit union, CECU is definitely the option for you. If you’re a sucker for a good user experience like me, on the other hand, go with Ando.

What I liked

• Climate impact — 100% of loans go to climate solutions like rooftop solar, EVs, electrification, energy efficiency etc. In other words, they’ve gone beyond divestment and are actually funding the energy transition.
• FDIC-insured — As a credit union, CECU’s deposits are insured by Uncle Sam up to $250,000.
• Online-first — There is nothing worse than having to go into a bank branch to do something that could be done online. CECU doesn’t operate branches of their own so everything is done on their app or website.
• Local branch network — But, they have a network of 6,000 credit unions that offer in-branch services. The closest branch to me is less than a mile away, which is pretty amazing for a credit union that offers accounts to people across the country. It’s the best of both worlds.
• Diverse board and leadership team — My wife and I believe justice and equity are essential parts of climate action. And banks have a pretty awful track record on this front, which has led to exclusionary practices that have hurt women and people of color. Last year two of CECU’s white board members stepped down and two women of color joined. And since the start the organization has been women-led.
• Easy Venmo integration — In the Venmo app you can easily link your account with CECU.
• Joint accounts — Unlike some of the other options below (cough, Ando, cough), CECU offers joint accounts.
• No fine-print or promo APY offers — Call me crazy, but I don’t like when banks say they offer 5% APY and then have an entire paragraph in size 6 font at the bottom of their website that says “Well, actually, we don’t offer 6% on any meaningful amount of money. But ya if you deposit $1,000 we’ll give you $.50 per month in interest!” CECU doesn’t do that. They are honest about the fact that, like every other bank in the world, they don’t really offer much interest on savings accounts (such is the low-interest rate world we live in).

What I didn’t like

• User experience — While I didn’t run into any real snags or problems, the user experience and design feels more like a traditional bank than the neo-banks I tested like Ando and Aspiration. As one example, when I signed up I had to take a picture of my ID on my phone, upload it to my computer, and then upload it to CECU. On Ando they had a feature where you could just scan in your ID on your phone which saved about 5 minutes.
• My application took a long time — It took more than a week to get approved for an account, whereas the other options all took a few minutes to 24 hours.
• No Mint integration — Unlike our local credit union and Aspiration, CECU doesn’t integrate with Mint. Considering I’ve used Mint every month for 6 years, this is a big bummer. But in Mint you can manually add the amount in any account so this isn’t a deal breaker for me.

The bank to watch: Atmos

Atmos almost won my heart.

There’s a lot to like about this company and the team behind it. 100% of deposits fund climate solutions. They encourage their users to support impactful non-profits. And the team is really responsive to feedback.

But I ran into a few bugs during the sign up process that made me go with Ando instead.

What I liked

• Climate impact — 100% of loans go to climate solutions like rooftop solar, EVs, electrification, energy efficiency etc. In other words, they’ve gone beyond divestment and are actually funding the energy transition.
• FDIC-insured — Like many “neo-banks” Atmos partnered with a traditional bank so that all deposits are FDIC-insured up to $250,000. If you have more than that in your savings account, you should be more worried about inflation eating that money than a banking crisis wiping out any of your money beyond the $250k.
• No branch, no paperwork — Atmos doesn’t have any physical locations. That means there’s zero chance they’ll make you come in to sign paperwork like traditional banks (cough, Chase, cough).
• No fees or minimums — They claim that there are no account minimums, monthly fees, or overdraft fees. As someone who has been hit with a lot of fees in my youthful, naive banking days, I can confirm this is a nice feature.
• 55,000 no fee ATM network — I think I’ve only used cash a handful of times since the pandemic, but in the past I used to spend about a hundred bucks per year on ATM fees. They’re no fun.
• Responsive team — The team responded to all my questions within a few hours and went above and beyond to make sure I had a good sign up experience. As someone who has been on hold with Chase for more than an hour, this was a breath of fresh air.

What I didn’t like

• I ran into bugs during the sign up process — Ultimately this prevented me from applying for an account. The CEO responded to my feedback within a few hours, and the engineering team fixed the bug within a day. But the experience and my general read of the company makes me think that there are still a few wrinkles to iron out. After all, the company shipped the first version of their product this year.
• No Mint integration — Considering I’ve used Mint every month for 6 years, this is a big bummer. But in Mint you can manually add the amount in any account so there is a workaround.

Atmos is definitely a bank to watch. Assuming they are able to iron out the user experience wrinkles, Atmos will be a great option. I’m certainly rooting for them and will plan to revisit them down the road and update this review.

The climate bank that could do more: Aspiration review

Like Atmos, I really wanted to like Aspiration. But I was sorely disappointed when I dug deep in the research process.

As I mentioned above, Clean Energy Credit Union, Ando, and Atmos all use customer deposits to make loans to people or businesses that want to install rooftop solar, buy an EV, or improve their home’s energy efficiency. In other words, they fund climate solutions and accelerate the transition to a zero-emissions economy.

Aspiration doesn’t do this. Instead they use your money to fund traditional home, car, and business loans through a network of community banks. So that’s reason #1 that I don’t recommend Aspiration. Rather than fund climate solutions, Aspiration funds business-as-usual activity.

The second reason I don’t recommend Aspiration is their incredibly disappointing approach to climate impact. Their website has all kinds of grandiose statements like, “Our planet is in danger – and time is running out. But you’re not helpless. In fact, the power to fight the climate crisis is in your hands – and your wallet.”

So how does Aspiration help you fight the climate crisis? With reforestation offsets.

On the Impact page of their website the company says that whenever you buy gas they’ll offset it by planting trees. They write, “No matter what kind of car you drive, you’ll have more peace of mind.”

There are three problems with this approach to impact:

• Most offsets don’t actually work — In the last couple years there have been a series of investigative reports that have shown that the vast majority of offset programs are a scam. In one study researchers found that 90% of programs don’t work.
• The climate benefits are temporary — As climate scientist Dr. Zeke Hausfather points out, reforestation offsets only temporarily sequester carbon. That’s great for the next few decades. But we need climate solutions that are permanent.
• Offsets send the wrong message — By telling customers they can drive their gas-combustion car with peace of mind, Aspiration is missing an opportunity to educate people on the real solution that they could help finance: electric vehicles.

Given that Aspiration has more customers than any of the banks I evaluated, I really hope they change their impact strategy. They have a huge opportunity to finance and educate their customers on the climate solutions that work. But for now, I don’t recommend using them.

Update (11/17/21): Joe Sanberg, one of the co-founders of Aspiration, responded to my critique of the company on Twitter here.

Correction (11/17/21): A previous version of this article said that Aspiration invests customer deposits in fossil fuel-free ETFs rather than community loans.

Read more of our guides

Alright that’s all for now folks! I hope this was helpful. If you have any feedback or questions don’t hesitate to reach out. My email is michael (at) carbonswitch (dot) co.

If you liked this guide you might enjoy some of the others that I’ve written:

• How to save money and energy with a heat pump
• Everything you need to know before switching to a heat pump
• Heat pump water heater buyer’s guide
• LED lighting buyer’s guide
• LED temperature and color guide