Greening Our Payments: nurturing sustainability in unsuspected aspects of our daily life

Over the last few years, we have witnessed an important surge in environmental consciousness. The need to find sustainable solutions has become a necessity as the world faces the challenges posed by climate change and dwindling resources. Therefore, it is crucial that every sector contributes to a collective effort for a better future, and the technological industry must stand as a crucial force driving transformation. At Sngular, recognizing our role and responsibility, we are constantly exploring ways in which we can contribute to the sustainability of our planet and the well-being of its people.

In this commitment to make a positive impact, we try to contribute from all our areas of business and expertise: design, marketing, more efficient software development, artificial intelligence, virtual reality… And, while it may come as a surprise to many, we have detected that even seemingly distant domains, such as Payments, hold remarkable potential for initiatives aimed at pushing towards a sustainable world. We will briefly explore the intersection between Payments and sustainability, with the hopes to highlight the remarkable potential that lies within every industry and contribute to this worldwide joint endeavor.

Let’s start by talking about cash. In 2018 the Dutch Central Bank carried out an assessment of the cost of cash into the environment. The results show that the cash payment system had a non-negligible 17 million kg CO2 equivalents a year, in a country that is highly digitized. The production and the transport of cash, and the consumption of ATMs, were identified as some of the major contributing factors.

Does this mean that eliminating cash limits the emissions on payments? By no means. Cards and other digital payment methods also have a relevant footprint, both at their production and their processing. Nevertheless, there are many ways in which the different actors in the payments domain can contribute to reducing their impact to our environment.

For example, we can reduce this impact by utilizing recycled materials for payment cards, or by completely removing the need for physical support integrating them into wallets and other mobile money alternatives. Retailers who unify their payment systems through an unique omni-channel solution can optimize their processes, which in turn leads to a lesser energy consumption of their systems. Companies can also define sustainability protocols centered in reducing the ecological footprint of their payment and refund processes, or even include compensations at the time of payment so the customer can choose to contribute to limit the impact of their activity.

On a different note, the digitalization of the Payments industry has additional side effects that, while not so obvious at first sight, can have an extremely positive impact towards the UN Agenda on Sustainability. These objectives emphasize the efforts to reach no poverty, zero hunger, and sustainable communities by 2030. In what respects to digital Payments, some numbers: In 2016, nearly half of the world’s farmers were unbanked. While 2016 might already seem to be too long ago after a pandemic, the situation has not changed so much: there were still 1.4 billion unbanked people as of 2021, a percentage particularly relevant amongst the poorest.

Facilitating the access of farmers to financial resources and digitalization has proven to be positive on both the household wellbeing and the subsequent agricultural yields. Small scale farmers represent around 95% of the world’s farms. Contributing to their digitalization and facilitating their access to digital financial means can have a significant impact both in their quality of life, the global food production and the improvement of the production techniques to reduce their climate impact. And in a world in which the demand of food will increase by 70% by 2050, every improvement can make a difference.

In this brief note, we do not intend to provide solutions to one of the most relevant challenges that we have faced as humanity, which is making our world a sustainable place to be for the 8 billion people that we are and all of the life that we share our world with. Instead, we aim to bring to everyone’s attention that, even in our most everyday actions, such as paying at the local market, there is something that can be done to contribute to our joint goal.