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Ethical Business Banking

Finding an ethical business bank account. Ethical and environmental ratings for 26 small business accounts. 

This guide covers banking for charities and small businesses and includes traditional banks, challenger digital banks plus building societies and other innovative banks.

Many charities and community groups are working to improve things for people and the planet. But, banking with some of the main high street banks may undermine their good work, if funds are used for fossil fuels and other unethical industries.

This ethical guide for small businesses, charities and community groups makes recommendations of who to bank with and who to avoid. 

About our guides

This is a shopping guide from Ethical Consumer, the UK's leading alternative consumer organisation. Since 1989 we've been researching and recording the social and environmental records of companies, and making the results available to you in a simple format.

Learn more about our shopping guides   →

Score table

Updated daily from our research database. Read the FAQs to learn more.

← Swipe left / right to view table contents →
Brand Name of the company Score (out of 100) Ratings Categories Explore related ratings in detail

Brand X

Company Profile: Brand X ltd
90
  • Animal Products
  • Climate
  • Company Ethos
  • Cotton Sourcing
  • Sustainable Materials
  • Tax Conduct
  • Workers

Brand Y

Company Profile: Brand Y ltd
33
  • Animal Products
  • Climate
  • Company Ethos
  • Cotton Sourcing
  • Sustainable Materials
  • Tax Conduct
  • Workers

What to buy

What to look for when choosing a business bank account:

  • Does it have an ethical lending policy? Banks can set themselves apart from the crowd by committing to only providing finance to companies that meet ethical criteria. For banks that provide mainly retail banking services, this is the main way they can ensure their business has a positive impact on society and the environment.

  • Does it eschew dodgy investments? Whether a mutual building society, a new bank focusing on retail banking, or a company with a strong ethical investment policy, the sustainable finance of the future must revolve around banks that say no to funding damaging industries.

What not to buy

What to avoid when choosing a current account for a small business or charity:

  • Does it invest in unethical corporations? Many UK banks provide important financial services for some of the worst offending corporations. Whether giants in retail, tech or energy, the unethical practices of many multinationals are effectively given the green light by our high street banks.

  • Does it avoid tax? The UK financial system is awash with questionable tax arrangements. Holding companies registered in tax havens are commonplace amongst the biggest banks. Make sure your account provider pays its fair share.

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Companies to avoid (subscribe to view)

In-depth Analysis

Choosing an ethical business bank account

Most banks use your money to make investments. Many banks invest in fossil fuels, weapons or other unethical practices which might contradict your own company ethos such as animal exploitation

But there are other providers that won't invest in these areas and which may be a better fit for your values and will be less of a reputational risk. There are also big problems with excessive director pay in banks. With increasing awareness of banks' unethical practices and the problems of wealth inequality, who charities and businesses bank with may be more of a consideration to your customers than it used to be.

Our ethical rankings for business bank accounts in the score table above include several that are solid ethical choices, many that have issues, and quite a few banks that should definitely be avoided. 

With scores ranging from almost no points out of 100 to almost full marks, moving your business or charity account to a more ethical provider is a quick way to have an immediate ethical impact.

Making an ethical impact with your business banking

We reveal which banks are the most ethical providers of current accounts for small businesses, charities and not-for-profit organisations.

  • The score table above compares providers of business current accounts.
  • Many banks listed both here and in our consumer savings accounts guide also offer business savings accounts.
  • Most banks and one major building society provide business current accounts, and these tend to come with monthly fees and transaction charges.
  • Some banks also offer special accounts for charities and not-for-profit community organisations, and you can find details of those below.

High street business banking

The four biggest banks remain dominant in the provision of business accounts in the UK, with Barclays, HSBC, Lloyds and NatWest controlling 85% of UK business accounts.

This is hardly surprising: switching is rare, physical branches are still important for financial advice, and many business directors prefer the ease of using the same bank for business as they do for personal finances.

However, the mainstream banks score very badly in our ratings. Unethical financial practices are most definitely the norm, with excessive directors’ pay and tax avoidance still rife. Furthermore, the big banks get marked down because of their investment practices. Far too many banks lend money to unethical corporations and a lack of transparency doesn’t help them take positive steps forward.

Barclays and HSBC stand out, but for the wrong reasons: they are two of the world’s leading providers of fossil fuel finance. 

Ethical alternatives for business banking

There are many actively ethical banks, as well as mutually owned building societies. Charities and businesses are therefore not limited to the 'big four' banks, and can show customers and supporters that their banking choice is another element of their ethical ethos.

CAF Bank (Charities Aid Foundation) is a charitable organisation, providing services exclusively to not-for-profits. 

Charity Bank reinvests savers’ deposits into loans that support positive social change, funding initiatives such as affordable housing, community centres, and environmental conservation projects. 

The Co-operative Bank with its strong, wide-ranging and customer-led ethical policy.  It has also been bought by the Coventry Building Society at the start of 2025, returning it to co-operative ownership after more than 10 years of being owned by US hedge-funds and other investors. 

Cumberland Building Society, now the only major building society to offer business current accounts, keeps its business practices simple by sticking to mortgage lending. Plus, it is mutually owned which helps to avoid the pressures of profit-hungry shareholders. It offers business current accounts to customers living in Cumbria, South West Scotland, West Northumberland and North Lancashire.

Reliance Bank is owned by the Salvation Army Trust, and specialises in lending to organisations that provide health and social care, affordable housing projects, and treatment centres that help people affected by gambling-related harm.

Triodos Bank  has strong environmental reporting and ethical policies, however it only offers saving accounts not current accounts for businesses. 

Unity Trust Bank performs well and has a clear and well-established commitment to providing banking services that have a positive social impact. 

The building society Nationwide took over Virgin Money in October 2024. These changes will hopefully prove that it's also possible for mutuals to service and lend to businesses in a more ethical way than mainstream banks have done so far. There is some work to do in clarifying their values in this new combination, but we are optimistic. 

Image: Business and charity bank accounts

Digital business banking

There has been a rise of app-based banking services for businesses, which appear to be a more ethical choice than the more established names due to having less involvement in damaging investments. However, it is not certain whether this will remain the case.

They generally sit around the middle of the score table. We hope that they will develop more robust ethical policies as they grow larger.


When is a bank not a bank?

Tide is not a bank in itself, but its accounts are provided by ClearBank, therefore all savings and deposits are covered under the Financial Services Compensation Scheme.

While Starling and Monzo became regulated banks in the UK almost 10 years ago, Revolut is still transitioning, so currently, your money is not protected in the same way as with a bank protected by the FSCS. Should Revolut fail though, there are still significant protections in place. 

We recommend that readers considering Revolut examine their website for more on this issue and read their page specifically on how they keep your money safe.

Full online access to our unique shopping guides, ethical rankings and company profiles. The essential ethical print magazine.

How to switch to an ethical business account

If you own a small or medium-sized businesses with a turnover of up to £6.5 million, the Current Account Switching Service will take care of everything for you.

Banking for charities and community groups

The brands ranked on the score table all provide current accounts for small business, but the offering for community groups and voluntary societies is much slimmer. 

The banks that do have accounts for non-profit organisations tend to come with the stipulation of being a registered charity.

Whilst the ‘challenger’ app-based banks listed above tailor their products towards making life easy for micro-businesses, they are still only for sole traders or registered companies. 

Which banks offer what for small businesses, charities and community organisations?

Current Account Debit card? Open to all organisations? Other Features
CAF Cash Account Mastercard available UK registered charities and social purpose enterprises.

£5 monthly fee.

Pay in at the Post Office, HSBC or RBS.

Co-op Bank Community Directplus Yes Registered charities, CICs and benefit societies, co-ops and credit unions.

No monthly fee.

Pay in at the Post Office, or check for a branch near you.

Metro Bank community Account Yes Clubs, societies or charities with an annual turnover of less than £250,000

No monthly fee.

Check for a branch near you.

Reliance Bank Charity Account Yes Available to registered charities. £7.50 monthly fee.
Unity Trust Business Account MultiPay Card (requires 2 years audited/certified accounts) Open to a wide range of organisations.  

£6 monthly fee.

Pay in at NatWest, RBS or Ulster Bank, or cash only at the Post Office.

Virgin Money (now owned by Nationwide) Yes One account for not-for-profit clubs and societies; one account for registered charities with annual turnover under £1million.

No monthly fee for not-for-profits with 10 transactions or less per month.

Pay in at Post Offices or other banks.

 

Church action on ethical banking

Rosie Venner from the JustMoney Movement explains about their work on switching churches to more ethical providers.

When people with shared values are meeting together regularly, grassroots movements flourish. The fair trade movement is a great example of this, with churches organising Traidcraft stalls long before fairly traded products were available in supermarkets.

Now there is a growing movement around ethical banking. This isn’t a new concern for churches, but it’s building momentum. From shareholder action to bank switching, churches are joining a wider civil society movement that is advocating for a greener, fairer banking sector.

Last year, over 70 churches and Christian organisations signed a statement calling on the 'Big 5' Banks (Barclays, HSBC, Lloyds, NatWest, and Santander) to stop financing fossil fuel expansion. This was supported by Churches Together in Britain and Ireland, and the World Council of Churches.

Churches are also choosing to switch to more ethical providers. JustMoney Movement produces an ethical banking guide for churches, using Ethical Consumer’s ratings. Downloads of this resource are growing year on year, as is attendance at “green your finances” training sessions for church treasurers.

One of the drivers for this growing interest in ethical banking is concern around the climate and nature crises. Over 8,000 churches have now registered as Eco Churches, taking practical action with their buildings, land, purchasing, and more. Switching bank may not be as visible as rewilding a churchyard or installing solar panels, but churches are recognising that their choice of bank is part of their climate action.

Ethical concerns around fossil fuel financing and the banking sector’s impact on nature are not the only factors behind churches switching banks. Like many small voluntary organisations, local churches are often poorly served by mainstream banks. Charities face significant challenges with banking, including accounts frozen without notice. By switching to an ethical bank, churches are championing banks that understand the charity sector and care about financial inclusion. This often means better customer service. It’s win-win.

We would all benefit from a greener, fairer banking sector, and we need a broad movement to get us there. If you are part of a church, or other faith or community group, could you make a more ethical choice with your banking this year?

JustMoney Movement is a Christian charity campaigning on ethical finance and economic justice.

De-risking and the impact on charity banking

In 2018, we reported on the issue of ‘de-risking’, a process whereby banks, in a bid to comply with new international regulations against money laundering, freeze or cancel bank accounts that seem risky.

Unfortunately, many humanitarian charities rely on transferring funds to high-risk locations to carry out their work. This can raise red flags for cautious account providers – banks such as Co-op and HSBC faced criticism, in 2015 and 2017, respectively, for closing the accounts of NGOs with little warning.

Since this time, there has been less reporting of de-risking which suggests banks are applying greater care and thought before they freeze an organisation’s account. However, it is often unclear whether any concrete action has taken place.

In a 2019 report from the House of Commons Treasury Committee, Stephen Jones from UK Finance highlighted the need for better communication from banks, stating “In terms of access to banking, it is very important that, if someone is de-banked, they understand why they have been de-banked, why the institution has de-risked, and we are working with the FCA on better communications around that.”

The 2018 Sanctions and Anti-Money Laundering Bill, which came into force when the UK left the EU listed general exemptions and licenses for NGOs carrying out humanitarian work in sanctioned countries. This was received as a positive step by some charity bodies. However, whether this will represent a major break from current de-risking practice remains to be seen.

Do ethical banks use unethical clearing banks?

Some of the smaller, more ethical banks in our guides may use larger banks to access the banking system. This is often referred to as the 'clearing bank' and was particularly prevalent for clearing cheques.

There is growing awareness of the ethics of banks, and customers are increasingly concerned that their attempts to avoid the 'big four' banks (Barlcays, HSBC Group, Lloyds Group, NatWest Group) are thwarted by the smaller banks and building societies using some of these big banks as their clearing bank.

We explore this in more detail, and list who uses which bank for clearing, within the savings guide.
 

Company behind the brand

The Cumberland Building Society mostly provides mortgages to individuals but about 10% of its lending is commercial and goes to Cumbrian tourism and hospitality providers or other small businesses. As a result, it scored highly in our lending policies and loans and investments ratings. 

It has a policy not to fund to fossil fuel projects but otherwise did not do that well in our climate rating; as a mortgage provider, we would hope to see discussion of the carbon impacts of its housing stock and initiatives to reduce these. 

It received marks in our Company Ethos category for being a mutual society, owned by its members and for being Living Wage certified.
 

Want to know more?

If you want to find out detailed information about a company and more about its ethical rating, then click on a brand name in the Score table. 

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This is a web only guide, and did not appear in the Ethical Consumer magazine.