How well do you really know your bank?
Most of us think carefully about where we spend our money. But fewer of us think about what happens to the money sitting in our bank account.
Your current account or savings balance is not simply sitting in a vault. Banks use customer deposits and wider funding to make loans, underwrite bonds and support businesses across the economy. That can include renewable energy, social housing and small businesses – but it can also include fossil fuels, deforestation, weapons, high executive pay and poor tax transparency.
This matters because banking is one of the biggest hidden climate and ethics issues in personal finance. The world’s 65 biggest banks have provided $7.9 trillion (£5.79 trillion) to fossil fuel companies since the Paris Agreement, according to the 2025 Banking on Climate Chaos report. In 2024 alone, they provided $869 billion (£637 billion) – a rise of $162.5 billion (£119.1 billion) on the previous year.
The problem is not just what banks finance. It is also the gap between glossy green marketing and what is happening behind the scenes. A European Central Bank blog found that banks talking more about their environmental policies and goals tended to lend more to “brown” industries.
Here, we look at five of the least ethical banks in the UK, based on fossil fuel financing, climate policies, transparency and wider ethical concerns.
At a glance: the UK banks most often criticised on ethics
| Banking group | Why it is flagged |
|---|---|
| Barclays | Europe’s largest fossil fuel financier; major criticism over fossil fuel expansion and greenwashing |
| HSBC / First Direct | Continued fossil fuel finance, weakened climate targets and previous ASA greenwashing ruling |
| Santander | Major rise in fossil fuel finance and concerns over policy backtracking |
| Lloyds / Halifax / Bank of Scotland / Scottish Widows | Lower fossil fuel financing than some peers, but still criticised for weak exclusions and greenwashing |
| NatWest / RBS / Ulster Bank / Coutts | Lower fossil fuel financing than some peers, but recently softened oil and gas lending rules |
1. Barclays
Barclays remains the UK bank most heavily criticised for fossil fuel finance.
According to Banking on Climate Chaos 2025, Barclays provided $35.4 billion (£27 billion) to fossil fuel companies in 2024, up 55 per cent on the previous year. That made it Europe’s largest fossil fuel financier and the seventh-largest globally. Bank.Green says $12.9 billion (£9.5 billion) of this went to fossil fuel expansion.
Barclays has announced restrictions on direct project finance for new oil and gas fields. But campaigners argue this does not go far enough because most fossil fuel finance is not provided as direct project finance. BankTrack notes that general corporate finance made up 93.6 per cent of fossil fuel finance between 2021 and 2024.
The bank has also faced criticism over greenwashing. Reclaim Finance said Barclays’ climate strategy failed to align with climate science because it did not systemically exclude companies with oil and gas expansion plans.
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2. HSBC (including First Direct)
HSBC has made high-profile climate commitments, but it continues to be one of the UK banks most criticised by campaigners.
Banking on Climate Chaos 2025 found HSBC provided $16.2 billion (£11.9 billion) in fossil fuel finance in 2024. Oil Change International said HSBC was among the European banks contributing between $14 billion (£10.3 billion)and $17.3 billion (£12.7 billion) to fossil fuels that year.
HSBC has also weakened some of its climate ambition. Reuters reported in 2025 that HSBC had dropped its 2030 net-zero target for its own operations, while maintaining a wider 2050 net-zero goal.
The bank has previously been censured by the Advertising Standards Authority over climate adverts. The ASA said future HSBC ads should disclose the bank’s contribution to greenhouse gas emissions.
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3. Santander
Santander is another major European bank facing growing scrutiny over fossil fuel finance.
Banking on Climate Chaos 2025 put Santander among Europe’s biggest fossil fuel financiers. Santander provided $17.3 billion (£12.7 billion) to fossil fuels in 2024, according to ShareAction, up from $13.9 billion (£10.2 billion) in 2023 and $7.5 billion (£5.5 billion) in 2022.
Bank.Green says Santander weakened one of its remaining oil exclusions in 2025. BankTrack also said the bank was “backtracking” on fossil fuel commitments and warned that client-level exclusions matter because most fossil fuel finance is general corporate finance rather than project finance.
For customers looking for an ethical bank, this matters because climate policy is not only about whether a bank avoids direct finance for a single oilfield or coal mine. It is also about whether it continues to support companies expanding fossil fuel production.
4. Lloyds Bank (including Halifax, Bank of Scotland, and Scottish Widows)
Lloyds provides much less fossil fuel finance than Barclays, HSBC or Santander, but it is still criticised for not going far enough.
Banking on Climate Chaos 2025 found Lloyds provided $1.6 billion (£1.2 billion) in fossil fuel finance in 2024. Bank.Green says Lloyds “has room for improvement” because it continues to finance fossil fuel companies and has inadequate policies to stop financing fossil fuel expanders.
Lloyds has also faced a greenwashing ruling. In December 2024, the Advertising Standards Authority banned a Lloyds advert for making misleading environmental claims, after finding it did not make clear enough that the bank continued to finance emissions-intensive activity.
InfluenceMap’s analysis of the big four UK banks found Lloyds financed fossil fuel companies over green companies at a ratio of 3.1 to 1 between 2020 and 2024.
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5. NatWest (including Royal Bank of Scotland, Ulster Bank, and Coutts)
NatWest is not the biggest fossil fuel financier on this list, but it still raises concerns.
Banking on Climate Chaos 2025 found NatWest provided $2.7 billion (£2 billion) in fossil fuel finance in 2024.
NatWest has also recently softened its fossil fuel lending rules. Reuters reported in February 2026 that the bank removed restrictions on some reserve-based lending for oil and gas exploration, including for new customers and companies without climate-aligned transition plans. ShareAction criticised the move as a step backwards.
To its credit, NatWest has set a £200 billion climate and transition finance target and says it wants to support customers through the transition. But for ethical banking customers, the concern is whether transition finance is matched by firm limits on continued fossil fuel expansion.
Why fossil fuel policies can be misleading
Many big banks now say they will not directly finance new oil and gas projects. That sounds significant – and in some cases it is progress.
But campaigners argue it leaves a major loophole. Most fossil fuel finance is not direct project finance. It is general finance to the companies developing new oil, gas and coal projects. BankTrack says project finance made up just 6.4 per cent of fossil fuel finance between 2021 and 2024, while general corporate finance made up 93.6 per cent.
That is why ethical banking campaigners increasingly focus on whether banks finance companies expanding fossil fuels, not only whether they finance specific projects.
Where to move your money for good
Switching bank is one of the simplest ways to bring your money more closely in line with your values.
A typical monthly salary removed from one of the Big Five and instead banked with a more environmentally-friendly provider ultimately means reducing the flow of finance to destructive industries such as fossil fuels and deforestation.
Ethical banks and building societies avoid investing in environmentally harmful or otherwise unethical industries, treat their staff and customers fairly, and pay their share of tax. The gold standard in ethical banking is Triodos Bank, which goes further than simply avoiding the bad stuff – it only invests your money to make a positive impact on the planet and society.
For ethical current accounts, we also like Nationwide Building Society and The Co-operative Bank as well as digital challengers such as Starling Bank.
For ethical savings accounts, we like the above as well as Charity Bank, Coventry Building Society, Ecology Building Society, Gatehouse Bank and Tandem Bank.
