News and resources on ESG data and technology, Impact Investing and Sustainable Finance initiatives and best practices.
Digitisation is a priority for ESG initiatives – Paymentology

Digitisation is a priority for ESG initiatives – Paymentology

ESG has a new meaning in 2024, with more and more financial institutions becoming increasingly transparent in their sustainable principles, and governments pushing harder for green regulation within the industry.

Speaking to the head of the sustainability department and programme management services at Paymentology, Drisha Kirkman, Finextra learned more about what the fintech sector should expect from businesses when it comes to their ESG objectives.

Kirkman states that payments companies are prioritising digitisation, so ESG objectives must be met as part of new deployments. She outlines that Paymentology is working on enabling tokenisation and virtual cards, concentrating on digital transformation. Kirkman adds that consumers are leaning towards more sustainable options for their products, so businesses are seeking the payoff of going green and having sustainable services that people feel good about purchasing.

“I think governments and regulators are becoming more and more involved in sustainability and adopting policies around it, especially clean energy policies, and regulation around what corporates are doing in this environment. What we are also seeing is that countries that do adopt regulation, and provide relief for businesses that do apply it, are actually the ones that are economically benefiting from it.”

On predictions for upcoming trends in the sustainable finance sector, Kirkman details: “ESG values are becoming increasingly pronounced. Both consumers and investors want the transparency around it. They want to see that the business they're working with recognises its social responsibility. I think there'll be a surge in organisations that are now creating these dedicated departments and it will be across all industries, not just payments, but there is definitely going to be this move towards having a sustainability department.”

She highlights that transparency with clients and customers is key to the next step in sustainable innovation within the fintech industry. However, challenges that companies are currently facing include economic barriers such as green solutions that can be more expensive, for example recyclable plastics or eco-friendly materials. She says that greener products and services are becoming more affordable, but the barriers for small companies are still prevalent.

She continues: “We will also see a lot of startups and fintechs actually moving into more innovative and socially conscious solutions. I have seen a couple of fintechs measure your carbon footprint when you do a transaction, they are able to take all the data from the very beginning and show you the impact of that transaction. We will see a lot more of those types of startups that are just focused on ESG-related solutions. Digital wallets are growing because they enable a digital experience; people want to be able to have the flexibility of transactions, but they want to also not have a million cards in their wallets. Wallets will continue to grow in our world.”

Kirkman explains that she has been working at the sustainability wing of Paymentology since 2006, and since then it has gone through a revolutionary wave of changes. Paymentology got an early start in its green journey; in its inception the company’s sustainability branch was focused on supporting the staff and on social impact of communities that they operate in, but that has evolved into concentrating on climate-conscious solutions.

Kirkman emphasises that making policies transparent and lowering carbon emissions are major objectives for Paymentology. In their carbon reduction front, the company is encouraging a remote and hybrid working environment, cutting down on carbon with tree planting initiatives, and reduction in terms of travel, arranging online meetings rather than flying across countries to see clientele.

In a concluding statement, Kirkman says that digitising solutions will now make the greatest difference for ESG-related goals, and adds: “We have always done the social side of it. We are now just working on the more environmental side. Having a policy made visible to the public would be our focus for this year, because we are in the process of documenting our pillars and what goals we are working towards.”

Comments: (0)