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Ethical banking

Being ethical and sustainable is important to us at HappyPorch. It’s been at the forefront of most big and strategic decisions but we’re not playing closer attention to our supplier list. Improving the quality of our supplier list is an ongoing and challenging task.

Banking has proven to be one of the most difficult. 

When Barry first started HappyPorch in 2014 (then trading as Ltd), he wanted to start things ‘right’ by using an ethical business bank from the very beginning. It made, and still makes us uncomfortable knowing that just behind the scenes, banks are hiding practices that don’t sit well with our company ethos, such as investing in fossil fuels, tobacco, oil, and armaments. 

Dig a little deeper and things can get very dark” - Tom, Wholegrain Digital

At the time, Triodos seemed like the most ethical option. It has strong environmental credentials and with most of the other non-high street banks/building societies not offering a business account we were eligible for, we went with Triodos. 

I don’t remember the exact process in setting up an account but I don’t think it was too painful. We were sent a little electronic doodad for logging on to the digital banking. This meant that only one of us had access to the money at any one time. Mostly, it was me, as I downloaded .csv files of our banking to upload to FreeAgent, our bookkeeping software. 

We didn’t have many expenses in the beginning and a lot of our software usage came through Barry’s personal accounts or were paid with using a personal credit card/PayPal. We liked that the bulk of our business money was available to a bank with ethical investment principals. 

However, we ran into problems with using our account. An international payment got lost and took months to sort out. During the process we learnt that a lot of payments are routed through RBS. We knew the single user log on would be a problem as we grew. We got more and more annoyed with not being able to do every day banking very easily. The problems with the payments and the time it took to sort out, coupled with learning that some of the investment partners which, while not ‘evil’ didn’t sit comfortably with our beliefs, meant that we needed to move away. We couldn’t sacrifice usability and support for environmental ethics. Sorry. 

We moved on to RBS in the interim, while we continued our research into alternative banking. As a personal customer, it was easy for Barry to set up an account. We also came to love and rely on the seamless integration with FreeAgent, and Xero, after we moved our bookkeeping to their platform. The interim period lasted longer than we care to admit but after reading Mike Berners-Lee’s How Bad are Bananas, we were inspired to look elsewhere. 

There wasn’t a lot of choice so, despite the sale to hedge funds, we transferred to the Co-operative Bank. Joining was a painful experience. It took us months. There were problems with us being a remote company and not physically working from our company registered address.The paperwork was onerous and it felt we needed to supply the same documents more than once. After finally being accepted, we were ready to roll into a new world of ‘best of a bad lot’ business banking. 

It felt like we went backwards. Again, we were sent a little gadget for logging into the online banking. The integration with Xero wasn’t as seamless as I was led to believe and had come to love with RBS. We had to log onto the Co-operative bank with the online banking gadget in order to force Xero to update. This made bookkeeping less efficient. We were also charged fees early on for not having moved the required balance from our RBS account to the Co-operative bank within their stated timescales (their paperwork took longer to reach us because we’re a remote company with a mail scanning service). Although one of the fees were refunded, it left a sour taste in our mouths after all the effort at our end to set up the account. 

Because of the physical gadget sign-in tool, we never really fully switched to the Co-operative and close the largely dormant account within a year. 

We continued the research. We knew we didn’t want to keep using RBS, or any other high street bank. Many of the smaller banks and building societies didn’t offer business accounts, and some of the ethical banks, such as the Charity Bank, didn’t offer everyday business accounts. 

Eventually we landed on Starling as our business alternative, and two months in, we love it. We’re happy with their ethics and assume that they are small enough to be able to stick to them without too much pressure to do otherwise: 

“We do not provide banking services to organisations that use excessive power to systemically promote public behaviour that is harmful to individuals, groups or to the whole of society in order to maximise their own profits. This may include, for example, arms manufacturers and tobacco companies. We do not invest in such organisations or take investment from them”

Starling is an app based bank and as a web development company, we’re happy with that. Their technology is excellent. We signed up for an account within minutes and were approved within about a week (once Barry managed to photograph his passport properly)

The integration with Xero is instant. I love that I can reconcile a payment immediately, instead of waiting 48 hours for RBS to update (it’s funny how quickly you can come to rely on something that didn’t seem a problem until the solution is already in place). 

So far, the customer service is top notch. Making payments with the app is super easy and now Barry can keep an eye on the account through the app while I have all the information I need within Xero.

The only thing that might make us change again (please no, I couldn’t bare it), would be when Monzo release their business accounts from beta. We’re a fan for personal and, especially, international use so their business solution might work for us. 

We still have some work to do with researching our personal credit cards (where a lot of payments still come from), and our use of PayPal but we’re delighted to have joined Starling. 

So far, we consider it a success.

About the author

Simone Gribble

Simone is controlling, in the best way. She keeps track of our sustainability on all fronts - financial, environmental, and social. The key instigator for the intense collaboration sessions that bring our distributed team together, Simone ensures we are always raising the bar to meet our mission.

If she's not running a finance report, you'll likely find her dancing, cycling, or sprinting across far-flung locations (and occasionally closer to one of her two homebases, Edinburgh and Melbourne).