By:
Zeb Drummond
COO, Gateway Bank
There are two subsects. You have people who are hyper environmentally conscious, and, at their core, they want to do the right thing from an environmental perspective. But then you also have the people that are slightly considerate of it, but their focus is more around their own pocket. From a consumer perspective, cost is the focus at the moment. At every turn, we’re seeing people try to improve their costs, be it through their lending or through other initiatives, such as cost savings like energy efficiency. Energy has been on the forefront of everyone’s minds when it comes to cost of living in more recent times. And it’s certainly starting to resonate through our member base as well.
For consumer lending, we offer a discount for customers if they have a property that meets the criteria. For example, if you meet the Green Star Home certification from Green Building Council of Australia (GBCA) or a 7-star rating from the Nationwide House Energy Rating Scheme (NatHERS) certification, then you get a 25-basis point discount off the standard package rate that we offer. We’ve launched apartment green lending as well, and we’ve done similar in the commercial space as well. The green personal loan really has value for those people who don’t necessarily want to have a mortgage over their house, or they might have a mortgage already in place, but they just want to do some of the uplift activities. That can be solar power, batteries, insulation, double glazing, electrifying houses, water retention efforts, water recycling. It’s quite an extensive list. And then once they’ve done that, they’ll look at refinancing wholly to a green home loan. We also have a green car loan process, which is focused around the type and style of vehicle (e.g. hybrid or electric). So, what we’ve tried to do is encourage people to make environmentally conscious decisions, but at the same time, not have to pay for doing so.
We’ve tried to encourage people to make environmentally conscious decisions, but not have to pay for doing so.
— Zeb Drummond, COO, Gateway Bank
Both. But from a retrofitting perspective, in Australia, we have a huge amount of properties already built that don’t meet NatHERS standard. So, there will be an ongoing focus on the uplift of carbon impacts for existing properties. That might look like the old fibro or cottage getting an uplift or just incremental improvements because the greatest output of carbon at the moment will be from the existing properties, not from the new ones.
We’re committed to a range of initiatives that help our members’ pockets and the planet. We’ve been committed to this space for a number of years. We believe it’s something that we can do and do really well. But it was our staff’s idea from the get-go. We asked the staff of Gateway, “What do you actually want to stand for? We have an opportunity – a rare opportunity in banking and finance – to redefine what we are going to be. What matters to the people that are here? What resonates with people?” It actually came from the staff – this is something that they cared about. Over multiple iterations, Pocket & Planet evolved as our purpose. And it has been really cool to see that it now has legs.
I think the easiest conversation is around the cost side of things. Every application is accompanied by “What does this cost?” and breaking it down to see whether it is important to the client to save on those costs. It’s an easy segue to go down from a broking perspective. I think it would be great if we got to a stage where every conversation included an element of what we are doing from a sustainability perspective. Certainly, that is what happens through our business at every turn – a conversation around sustainability and what we are doing at every single decision that we make as a business. It would be a brilliant place to get to if brokers were having that similar conversation with customers around what their sustainability drivers actually are. It won’t be to everybody, and it won’t be to everybody on day one. But I think more and more, it’ll influence buying decisions.
Tune in to hear more! You can hear more from Zeb Drummond as he analyses the broader sustainable lending landscape on The Adviser’s In Focus podcast here:
We’ve tried to encourage people to make environmentally conscious decisions, but not have to pay for doing so.
— Zeb Drummond, COO, Gateway Bank
Zeb Drummond
COO, Gateway Bank
Gateway Bank
From a briefcase to a trusted customer-owned bank, Gateway has come a long way over the past 60 years. Today, it serves more than 30,000 members and manages assets exceeding $1 billion. Gateway offers a range of competitively priced products and services designed to help secure the financial future and wellbeing of its members.
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