Do you know what happens to your money when you put it into a bank? It may be used for fossil fuel extraction and distribution for crude oil, natural gas, coal, or tar sands — all projects and industries that banks enable through financial loans and access to credit. In 2021, commercial banks invested $742 billion into the oil and gas industry.

While it may feel like the average consumer has no control over what business decisions these companies make, it’s actually your money that gives them the opportunity to invest in fossil fuels. So, what can you do, and where can you go if you no longer wish to bank at your current institution?

Changing your bank and putting your money into institutions that do not fund fossil fuel industries can be one of the most powerful ways to fight climate change. With lower interest rates, a focus on investing locally, and a much lower likelihood of investments in fossil fuel industries, credit unions can be great financial institutions for your deposits.

Banks’ fossil fuel invesments

Record high temperatures, rising oceans, and freak weather phenomena becoming yearly occurrences are all consequences of climate change. When people try to live more climate conscious lives in response to this, they typically drive less, recycle, and switch to greener energies such as solar.

What doesn’t often get mentioned in conversations is how industries directly contributing to the crisis get the money they need to operate in the first place, and how the average person can prevent their dollar from financing them.

According to a 2021 report by the Rainforest Action Network, 60 of the biggest banks in the world have spent $4.6 trillion financing fossil fuels in the six years since the Paris Agreement, which is an international treaty to limit greenhouse emissions, the leading cause of climate change. American banks are the worst contributors, with the six largest banks in the U.S. providing 29 percent of all fossil fuel financing in 2021.

These banks include JP Morgan Chase, Wells Fargo, Bank of America, Citigroup, Morgan Stanley, and Goldman Sachs. JP Morgan Chase, in particular, is the worst offender, contributing 34 percent more in financing than the next bank.

Unfulfilled promises

In response to public pressure and the Biden Administration, six of the biggest banks made net-zero commitments in 2021, but none have seemed to follow through. In fact, some banks even increased their financing of fossil fuels that same year. Wells Fargo, which made a commitment to be net-zero by 2050, spent $20 billion more in 2021 compared to 2020. JP Morgan Chase spent $10 billion more in 2021. To many it seems as though these banks have no real intention of fully leaving fossil fuel sectors, no matter what they promise the public.

It’s easy to feel helpless in the face of such large and powerful companies, but the average person has greater influence over these institutions than one might think. By banking at these places, the consumer leaves the use of their money at the discretion of the bank. Removing your money from these institutions takes away from what’s available for them to invest.

A potential solution

So, what would be different at a credit union? A key difference between banks and credit unions is that credit unions are not-for-profit, meaning that their focus is to prioritize their members rather than any shareholders or profits. Due to this non-profit structure, any extra money that would’ve been profit at a bank is converted into benefits for members, including lower credit card and loan interest rates and lower fees.

“Credit unions were founded on the philosophy of people helping people. We put people over profits and are committed to the prosperity of the communities we serve,” says Vice President of Marketing & Operations Kelley Jacobsen with Yolo Federal Credit Union.

While credit unions may appear to have fewer branch locations or their credit card benefits may seem not to be as good as what’s offered by banks, there is actually little difference between the services offered at these financial institutions. In fact, credit unions have multiple benefits over traditional banks.

Jacobsen says, “There are often misconceptions about credit unions. One of these misconceptions is that we don’t offer the same products and services as the big banks. Yolo Federal Credit Union offers the same products you can find at the big banks, and we actually have more locations in Yolo County than any other bank. We’re also one of the first in our area to offer video teller technology.”


Credit unions may have fewer total branch locations than national banks, but that’s due to the fact that they’re typically based and run locally. Because of this, credit unions are more likely to give loans to local residents and small businesses and to invest in the surrounding community.

Also, the Co-op Network (shared branch/shared branching and express branch service) allows depositors to use ATMs and basic services at other credit unions across the nation surcharge free. The network boasts 5,000 branches worldwide. So, if you can find a credit union where you are, you can get access to your accounts for free. The Your Money Further website also helps you find a credit union near you and tons of other helpful information. Founded by the Credit Union National Association (CUNA) and sponsored by many credit unions, including Yolo FCU, and others listed in this article, this site has great tips for financial wellness.

While credit unions formerly limited membership to certain service groups, most are now open to anyone.

Credit unions in Yolo County include Yolo Federal Credit Union, Travis Credit Union, University Credit Union located at UC Davis Memorial Union, Golden1 Credit Union, USE Credit Union, and SAFE Credit Union.

Fossil fuel free?

As part of their charter, credit unions cannot invest in the stock market, while banks can and do. Credit unions do not invest deposits directly into fossil fuels because they do not make these type of investments. Credit unions are allowed to invest in public instruments like federal bonds only.

However, each institution makes its own individual lending decisions, as demonstrated in the most recent National Credit Union Administration strategic plan (link below). The NCUA recently revised its strategic plan to clarify that “the agency will not take regulatory action based on ‘climate-related financial risks’ to discourage credit unions from lending to ‘family farms and others in the agricultural sector as well as businesses tied to the fossil fuel industry.’ ”

Other solutions and resources

If you still don’t think credit unions are the right place for you, there are many resources that can help you to choose the right place for your money to reflect your values and your needs. Check out the list below:

  • Mighty Deposits, with the tag line of “Find out what your bank does with your money,” Mighty Deposits allows you to filter through a database of banks and credit unions. You can search for sustainability, investing in the community, institutions owned or led by African Americans, those not funding fossil fuels, and those investing in marginalized areas.
  • Bank For Good starts you off with a pledge to switch to a financial institution that aligns with your values, all of which were vetted and gave permission to be listed. You can filter for various services and type of institution.
  • BankTrack offers an extensive and up-to-date collection of news articles and publications on banks’ relationships to human rights, climate, nature, and more. Check out their 2022 report, “Banking on Climate Chaos: Fossil Fuel Finance”
  • Stop the Money Pipeline is a grassroots coalition of over 200 organizations that provides step-by-step instructions on how exactly to change your bank. Go to the Move Your Money page. Check out their activism campaigns while you’re there!
  • Third Act, founded by Bill McKibben and Vanessa Arcara, runs a Banking on Our Future campaign, which asks for a pledge and encourages letter writing through March 2023 but to hold off on the switch: “When the time is right, we will make good on our pledges together, en masse.” The blog shares several recent articles on aligning your money with your values; one, in particular, features a video by Katie Eder, a youth climate organizer with Future Coalition.
  • Check out Slow Money and their new Beetcoin program that turns donations into 0% loans, by majority vote of our members, to local, organic farms and small food enterprises.

Credit Union resources

Your Money Further website

Co-Op Network ATMs and branches

Hillary Hoang is a writing intern for Cool Davis through the University Writing Program at UC Davis. Hillary is a Senior majoring in Managerial Economics with interests in video esssays who also volunteers as a tax intern, providing free tax assistance for low income residents of the greater Sacramento area.

Hillary authored this article with contributions from Cool Davis Communications Manager Leslie Crenna.


More reading

New University Credit Union on campus: