South African banking is dominated by the big four, Absa, First National Bank, Nedbank and Standard Bank, with little Capitec trailing in very distant fifth place. If you’re looking at opening a savings account, Capitec are the only one where the account has even a chance of living up to the name, with the others eating into your “savings” with huge monthly fees.
Generally, recommending a bank goes along the lines of “they’re less bad than the others”, and if asked to associate a word with “bank”, for most people it’d probably be a negative word such as “slimy”, or “greedy”.
Certainly not “ethical”.
There’s a difference between being ethical, and simply running a few worthy projects. Much like gangsters who sell tik and carry out hits on neighbouring gangs wouldn’t be considered ethical by most, in spite of frequently providing much-needed social services to their community, supporting an arts festival while funding a coal power station, or supporting a wetland rehabilitation project while funding an arms company would disqualify a bank by most measurements.
Banks that claim to be ethical do exist internationally. In essence, this means they consider the social and environmental impacts of their investments and loans, and apply various criteria. The Co-operative Bank in the UK refuses to invest in companies involved in the arms trade, climate change, genetic engineering, animal testing or sweatshop labour. GLS Gemeinschaftsbank in Germany focuses on cultural, social and ecological projects, lending to organic farms, health food stores, kindergartens, nursing homes and the like, and is completely transparent about all its investments.
Nothing similar yet exists in South Africa.
However, there is a move underfoot change this, and form an ethical bank. It began in July 2010 from a group involved in the Stellenbosch Waldorf School community, and a board was elected with the eventual intention of developing an ethical co-operative bank.
It’s not a quick process. The first stage is to register as a stokvel, recently formalised as a savings vehicle. To achieve this, they are looking for 30 to 50 paid-up members and a total of R20 000 savings.
After this, the goal is to become a Financial Services Co-operative, and finally a Co-operative bank.
It’s an exciting project, and one I hope succeeds – if you’re interested in becoming involved at this early stage, send a mail to Craig Tilsley at email@example.com.