Fintech aims to reduce the climate impact of users' spending. A new credit card helps users track and measure CO2 emissions associated with their purchases.
The world’s first credit card with a carbon limit. Image credit: Doconomy.
Doconomy, a Swedish fintech startup, was founded in 2018. Since then, it has raised 1 round of investment – a Corporate Round raised on Dec 10, 2019.
The company’s philosophy is based on the fact that we all need to tackle climate change in our daily actions and that we can use the most powerful tool to do so – our money. Therefore, Doconomy wants to inspire change in consumer behavior and reduce unsustainable consumption and carbon emissions.
In order to achieve this, the company has worked with Mastercard to develop a radical credit card – DO – for consumers wanting to act against climate change. The credit card prevents consumers from exceeding their limit, not based on credit, but on levels of carbon emission caused by their consumption.
In addition, DO card owners will also be invited to compensate for their environmental impact by donating to or participating in projects that meet the criteria of United Nations certified green projects, which contribute to achieving the UN's Sustainable Development Goals.
Users will also be rewarded financially for being more environmentally friendly. For instance, DO owners can receive refunds – also known as ‘DO credits’ – from connected stores based on the carbon impact of their purchases.
“We all need to come to terms with the urgency of the situation and rapidly move towards more responsible consumption. With DO Black, there are no more excuses. Through our collaboration with UNFCCC and Mastercard, DO will enable people to do their part to contribute to the carbon reduction goals of 2030 and onwards,” says Nathalie Green, CEO at Doconomy.
Doconomy is just one of many companies striving to reduce carbon emissions. Recently, Antler invested in YAYZY – a startup that helps customers find eco-friendly restaurants, retailers, and grocery shops, as well as make sustainable investments. Moreover, fintech startups like CoGo, Good Tech Lab and La Bolsa Social are among the top competitors of Doconomy.
Unfortunately, none of these competitors are China-based companies. These kinds of companies and financial products might help China to reduce its environmental impact. According to the World Bank, the biggest absolute carbon emissions come from China, followed by the United States. But the good news is the country is determined to reduce its carbon footprint by 2030.
These developments, combined with China’s ability to collect data, create a huge opportunity for Chinese companies such as Alibaba and Tencent to launch similar products.