Cogo launched the technology in the UK in 2018 through Natwest. CBA also has a relationship with the burgeoning fintech and last month launched the Cogo app to its customer base. So far, the bank says more than 300,000 people have used the feature.
Cogo started life as a charity called Conscious Consumer in 2010 with an app that helped people to find sustainable cafés and restaurants.
“We knew people wanted to spend more in a more socially-responsible way, but it's often hard to know which places to buy from or what product to buy. We incorporated In 2016,” explains CEO and founder Ben Gleisman.
“We help people measure and reduce their carbon footprint. For instance, we can let people know how much they can save on their energy bills if they put solar panels on their house. Then we support customers to offset their footprint by buying carbon credits,” he adds.
Open banking powered the underlying technology originally, Gleisman explains.
“You downloaded the app and it would integrate with 42 different banks. It was an opportunity for us to validate the idea people want to see their carbon footprint and we were able to calculate it pretty accurately based on data from bank transactions.”
The feedback from banks was rather than promoting a separate app for its customers to use to calculate their carbon footprint, banks wanted the tech built into their own systems.
“Now, we have an API through which banks send us merchant category codes that we use that maps the way the bank categorises each transaction. It maps that data to emission factors, so we can work out for every dollar spent in a certain category, how much carbon is generated,” says Gleisman.
“Many banks are making commitments to green lending and finance; helping homes buy batteries or electric vehicles. Our product helps banks and customers identify significant carbon footprints that could be reduced through making behavioural changes or buying different energy.
Banks are interested in our database of low carbon suppliers they can recommend to their customers,” he says.
What about the credits?
In Australia, Cogo works with a partner called Green Collar, which generates carbon credits through land management practices such as reforestation and preserving existing forested areas. It effectively creates sinks that help absorb carbon dioxide. CBA’s cutomers can buy its carbon credits.
As for the future, by the end of next year, Gleisman wants a quarter of a billion people to be able to track their carbon footprint through Cogo technology.
“We're also launching a product for small businesses to measure and reduce their carbon. So the medium-term vision is to go from just retail banking to business banking.”
It’s also in the process of raising US$30 million in a Series A round.
Comenting on the bank’s relationship with Cogo, Ben Morgan, CBA’s general manager strategy investments and transformation said, “by combining our rich customer data and Cogo’s industry-leading capability in measuring carbon outputs, we will be able to provide greater transparency for customers so they can reduce their environmental footprint.
“In addition to our partnership with CoGo, we’ve also partnered with Amber – a new type of energy retailer giving customers direct access to the real-time wholesale energy price. Earlier this year we also launched the Green Home Offer, providing eligible home loan customers with access to a low standard variable rate if their home meets certain sustainability and energy efficient criteria.”
It’s expected most other banks in the market will follow CBA’s suite and start to help customers measure and reduce their carbon credits.