Consumer advocates warn sustainability fintech Tomorrow
The Hamburg Neobank Tomorrow, which advertises as particularly sustainable, has problems with consumer protection. It’s about misleading advertising and a much bigger problem for the entire industry.
The Hamburg-based fintech startup, which has been positioning itself as a modern bank for sustainability for three years, is now in trouble with consumer protection. The company, which tries to differentiate itself from conventional banks with ecological accounts and cards made of wood, promises that customers can offset their digital footprint if they opt for a premium account made of wood.
The company leaves it undiscussed for what exactly – and the consumer advocates at the Baden-Württemberg consumer advice center are now taking it kicking off. They sent the fintech a warning on the grounds that the statement that customers could compensate for their carbon footprint in this way was not applicable in this form and generality, as the advertising message was misleading. “For interested consumers, it would of course be an asset if they could reduce ‘their carbon footprint’. But how should a company know this and then be able to compensate it exactly? Everyone has an individual CO2 footprint because the product selection is never congruent, ”explained Niels Nauhauser from the Baden-Württemberg consumer center.
Contents
How sustainable Tomorrow is remains unclear
According to the bank, which, strictly speaking, is a fintech using the Solarisbank license, it has now been related to the annual German average, which is now also described in more concrete terms, as it now says: “We finance CO₂- through the account fee. Certificates that offset the CO2 footprint of the annual German average of 11.17 tonnes of CO2 emissions per capita. “
The consumer advocates are really satisfied, as is so often the case, but not even with this regulation. This average value is simply insubstantial, it says in a message, and in general, thanks to the cooperation with Solaris, the bank is not a real bank either, so it should actually be more about their footprint per customer. “The account holder’s money is with Solarisbank. However, it does not publish an annual report or meaningful information on the sustainability of the use of funds on its website, ”says Nauhauser, criticizing the lack of transparency. But since it is about the footprint that customers produce and not explicitly about the banking service associated with it, it should actually be irrelevant in terms of environmental protection through whom the banking service is processed.
The cooperation with Solarisbank had already caused trouble for Tomorrow last year. However, at that time it was about the lack of sufficient representation of the account fees. Similar to numerous other banks, Tomorrow referred to the partner bank’s terms and conditions, but this may not be sufficient in court, as the consumer advocates denounced.
In general, the assessment of sustainability according to the ESG criteria is difficult because much of the information given in this regard is based on the self-reports of those involved. For this purpose, a “clear legal regulation for statements on the climate protection effect of products and services” must be created in order to make the ESG marketing tool verifiable. An objection with which the consumer advocates are correct, but which shows a much bigger problem: Consumers currently have no reliable information on the climate impact of an investment or a payment service from a third party – which is astonishing in view of the immense scope of the topic meanwhile in financial marketing.
