The green banking has its own magnitude in the modern period. It is an umbrella term referring to practices, protective and guidelines that make banks sustainable in economic, environment, and social dimensions. It aims to make banking processes and the use of IT and physical infrastructure as efficient and effective as possible, with zero or minimal impact on the environment. If a bank needs to promote its business then it should adopt green banking between consumer and banker for reaching its target. This study shows result of impact of green banking in ecological protection. For this purpose I selected a branch of SBI in Dharmapuri district. Hundred and twenty five respondents are selected to interpret this present study.
Keywords: Green Banking, Concepts, Features, Ecological Protection and Green Banking Products.
First Green Banking was founded in 2009 in the state of Florida. Based in Eustis and Clermont, Florida, USA, First Green Banking is a customer-driven community bank providing personalized service, localized decision- making and proven technology by promoting a positive environment that is acceptable to the community.
State Bank of India, India’s largest commercial bank, took the lead in setting high sustainability standards and completed the first step in its ‘Green Banking’ initiative with Shri O.P.Bhatt, Chairman, SBI inaugurating the bank’s first Wind farm project in Coimbatore. Recent Green Banking initiatives include a push for solar powered ATM’S , paper less banking for customers, clean energy projects and the building of Wind mills in rural India. SBI is a leader in Green Banking.
Green banking aims at improving the operations and technology along with making the clients habits environment friendly in the banking business. It is like normal banking along with the consideration for social as well as environmental factors for protecting the environment. This study shows result of impact of green banking in ecological protection. For this purpose I selected a branch of State Bank India in Dharmapuri district Tamilnadu.
Concepts of Green Banking
Green banking means promoting environment friendly practices and reducing carbon footprint from banking activities. This comes in many forms viz., using online banking instead of branch banking, paying bills online instead of mailing them, opening of commercial deposits and money market accounts in online banks etc., Green banking refers to the efficient and effective use of computers, printers and servers to optimize the use of energy and waste-less paper. One of the important ways in which banks can implement green banking is by promoting the use of online banking among customers. Online banking helps reduce paperwork and the need to travel to bank branches.
Characteristics& features of Green Banking
Depending on the state, a green bank may conform to a variety of forms, utilize many different public funds, and create a diverse array of financial products. Banks may utilize financial tools such as long-term and low interest rate loans; revolving loan funds, insurance products and low-cost public investments or it may design new financial products.
Ultimately, all green banks will exhibit several common characteristics. Stimulate demand by covering 100% of the upfront costs with a mixture of public and private financing. Leverage public funds by attracting much greater private investment for clean energy and markets. Recycle public capital so as to expand green investment and leave taxpayers unharmed.
Review of Literature
The practice of green banking will be useful for environmental protection as well as operational efficiencies. The SBI has initiated urgent measures to the climate change by reducing the bank’s own carbon foot print and sensitizing the bank’s clients to adopt low carbon emission practices (Sharma N, 2011). The impact of banking services on the environment is huge. ATMs have been widely adopted but the level of adoption of other electronic banking mean despite their potential are yet to pick in a big way (Joshua AJ & Koshy MP 2011).
Bahl , Sarita (2012) conducted an empirical study on” Green Banking – The new strategic imperative” tried to find out the most significant strategies while going ahead with green banking by using Garrett’s ranking technique. Chaurasia (2014) in his paper “Green Banking practices in Indian Banks” highlighted the benefits, challenges, and strategic aspects of green banking. It plays a protective role to take ecological aspects as part of their lending principle. International Journal of Interdisciplinary and Multidisciplinary Studies (IJIMS) 2015 to go far mandated investment for environmental management, use of appropriate technologies and management systems.
Ecological Protection by Indian Banking Sector
Banks are the most important institutions that help business activities. And it play major role in the development of country’s economy. According to section 5(1) (b) of Banking Regulation Act, 1949; banking as; “Accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise, and withdraw able by cheque, draft, order or otherwise.” In modern period, the functions of banks are increasing day by day. They also concerned about the environmental issues. So they take necessary steps to avoid such issues for a limit.
The various banks in India which provide green banking services to their customers are as follows
State Bank of India
State Bank of India is the largest public sector bank in India in terms of market capitalization, profit, net profit, revenue and assets. And SBI is one of the major banks that encourage the environmental protection. SBI has a green channel counter for encouraging paperless work. There is no use of pay slips, withdrawal forms, cheque leaves, remittance forms and the transactions are done through SBI ATM cum debit card.SBI initiated carbon disclosure project in the financial sector in India, for the sake of environmental concern and safety by the Carbon Disclosure Project of World Wide Fund (WWW). SBI has launched green banking policy and set up windmills in Tamil Nadu, Maharashtra and Gujarat in generating 15MW power. This is the first bank in India which is in green banking and promoting green power projects.
Punjab National Bank: They had taken various steps for reducing emission and energy consumption.
Bank of Baroda: They had taken various green banking initiatives such as financing a commercial project. BOB is giving preference to environment friendly green projects such as windmills, biomass and solar power projects which help in earning the carbon credits.
Canara Bank: As a part of green banking initiative it had adopted environmental friendly measures such as mobile banking, internet banking, telebanking, solar powered biometric operations.
ICICI Bank Ltd: ICICI bank had started Go Green initiative which involves activities like Green products/offerings, green engagement and green communication with customers.
HDFC Bank Ltd: HDFC bank is taking up various measures for reducing their carbon footprints in waste management, paper use and energy efficiencies.
Kotak Mahindra Bank: Through the Think Green initiative this bank had taken several initiatives such as to reduce the paper consumption and encouraging their customers to sign for e-statements and they had become partners with Grow-Tree.com to plant one sapling for every e-statement on behalf of its customers.
IndusInd Bank: It has initiated its Green Office Project under which it had installed solar powered ATMs in different cities targeting energy saving as well as reducing CO2 emissions.
YES Bank: It has projects portfolio in the areas of alternative energy and clean Technologies.
HSBC Group: HSBC has separate targets for data center, paper consumption and business air travel. The purposes of the targets are to drive efficiency, reduce its operational impact on the environment and generate cost savings.
IDBI: IDBI Bank is providing various services in the field of Clean Development Mechanisms (CDM) to its client.
- To find about the impact of green banking in ecological protection.
- To identify the strategies adopted by State Bank India for green banking
- To know the factors used for promoting green banking.
The nature of the study is descriptive and it has been conducted by using primary as well as secondary data collected for this purpose. It is an attempt to study about the green banking concept and its importance in ecological protection. Sampling Method was made in accordance with the convenience of the employees and customers. The data needed for this study has been collected from the employees through questionnaires, interviews. For this study I selected the State Bank of India in Dharmapuri District, Tamilnadu.
- Primary Data: it is first hand information used to collect data from the respondents directly through distributing questionnaires.
- Secondary Data: It is published data collected from journals, books and magazines, online to develop the theory.
- Sample Size: It is determined as 125 respondent’s opinion from the respondents who are presently being employees of State Bank of India and its customers.
- Tools Used: The primary data was collected through questionnaires, interviews and facts are presented in the form of tables, graphs, pie diagrams and charts.
Benefits of Green Banking
- It helps to keep away from paper works; it will help to minimize the cutting of trees.
- It helps to create awareness to business people about ecological.
- To get loans at comparatively lesser rates.
- Green values for lending.
- Among the total respondents, maximum (66.4%) of the respondents are male.
- Among the total respondents, maximum (42.4% of the respondents belong to the age group of 31 to 45 years.
- Maximum (50.4%) of the respondents in profession status of employees’ level.
- Income of respondents mainly falls in the range of Rs. 10,001 to Rs. 20,000 that is (47.2%).
- Popularity of Green Banking Concept is (56%) average among the total respondents.
- Best Methods of Promotion of Green Banking is Net banking maximum (31.2%) among the total respondents.
- Among the total respondents factors used for green banking maximum (11.2% ) of the respondents event meeting.
- Bankers have to explain its customers about ecological products through a public website.
- It will be admirable to conduct events for popularizing the green banking concept.
- To give responsiveness through press Medias also.
The green banking is the operation of the financial sector with special focus on the environmental, ecological and social factors. Green banking is not well developed in SBI branch dharmapuri district and it is backward rural area so the concept of green banking is not well popularized to this area. However, banks take necessary steps to protect and preserve environment by green banking. In the present condition, the environmental problems are increasing day by day. They target the conservation of nature and natural recourses. It helps to create awareness about environmental protection among business people and helps to promote the environmental management.The Indian banks are actively looking for effective ways to implement green banking methods for the protection of environment.
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