Jimmy Stewart taught me how a bank works. For most of my childhood, I thought of banks as lollipop dispensing locations where my mother would bring me when she was errand running. We would go in, she would talk to a nice person, and that nice person would give her money and me a Dum Dum. Pretty sweet deal (pun!).
I got a bit older and realized that a bank’s purpose of existence was not, despite my lifetime of experience, to satiate my sweet tooth. I realized that money was more valuable than lollipops and that when you gave a bank your money, it would give it back to you later. Aha! A bank is like a school locker – a place to put your things so no one else takes them.
I got a bit older still, and my understanding evolved further. I learned the basics of interest, and then I realized that banks don’t just give you your money back later; they also give you a little bit extra. Aha again! A bank is like the lawn I had to mow – it has some grass now, but wait a bit and it has more grass later.
Then, one Christmas in my teenage years when we all settled in to watch It’s A Wonderful Life, I remember seeing that scene where the town has a bank run. George Bailey, portrayed by Jimmy Stewart, is about to bounce town for his honeymoon when he sees his family’s savings and loan bank overrun with people. He and his young bride (Donna Reed) come to the rescue, using their honeymoon stack of cash to satisfy everyone’s withdrawal requests. During that scene, Jimmy patiently explains how his business works, lending the collective deposits of the town out to people who promise to pay those loans back with interest. Aha once more! Banks are like crowdsourced financing mechanisms for the things that get built in our communities. Thanks Jimmy Stewart.
Now that I’m a fully grown adult who just pilfers Dum Dums from my kids’ stash instead of getting them from the bank, I understand how important banks are in society. Where and how they choose to loan their deposits determines what happens in this world of ours. Which houses get built, what colleges we go to, which jobs get created with a corporate relocation – all are enabled by the access to financing that banks offer.
So wherever banks loan their money, we see more of whatever the borrower does. If banks lend to plastic straw makers, we see more plastic straws that inevitably end up in the oceans. If banks lend to chemical companies, we see more harmful chemicals that frequently disperse into the environment. If banks lend to oil companies, we see more fossil fuel extraction and eventual emissions of greenhouse gases into the atmosphere. You get the idea.
But banks don’t have to be a part of our environmental problems. If they choose, they can be part of our environmental solutions. That’s the whole idea behind green banks, and it’s also the whole idea behind a new startup I just discovered called Atmos.
Launched at the beginning of the year, Atmos is a fintech company that partners with banks to offer FDIC-insured deposit products, and their promise to customers is that all deposits accepted through their platform will be deployed to finance climate-positive infrastructure (like solar power installations). Deposits through their platform earn a savings rate (their term for interest) up to 0.51% with no minimum balance and no fees. While they aren’t a bank legally, their platform lets you essentially bank (or rather “save,” since they currently offer savings accounts with checking and loan products on the way) in a way that helps solve the climate crisis. With higher rates than most, no fees, FDIC-insurance, sign-up through funding in less than five minutes and a user-friendly tech platform, Atmos is trying to remove any excuse for us not to bank on the clean economy.
It's a promising example of entrepreneurs who see old business models and want to tweak them in a way that solves, rather than exacerbates, humanity’s problems. Imagine if all banks approached banking the way Atmos does. We might see fewer of the things that are killing the planet, and more of the things we actually want.