Your bank might feel like the boring bit of your money life. It’s where your salary lands, your bills go out and your online shopping decisions happen.
But banks do far more than hold our money; they lend to companies, arrange finance and help businesses raise money. In other words, they help decide what gets built, expanded and protected.
The new Banking on Climate Chaos report has just landed, and it makes shocking reading. It finds that the world’s 65 biggest banks committed $906.4 billion (£676.5 billion) to fossil fuel companies in 2025, up 7.6 per cent on the previous year.
But for UK customers, the most revealing part is fossil fuel expansion.
Some banks may cut their overall fossil fuel finance, while still increasing finance to companies developing new oil, gas and coal projects.
What is fossil fuel expansion?
Fossil fuel expansion means companies developing new oil, gas or coal production, infrastructure or power projects.
So this isn’t only about banks financing fossil fuel companies that already exist, it’s about banks helping to fund the companies building more fossil fuel capacity now.
The report says bank finance for companies expanding fossil fuels rose to $508.4 billion (£379.5 billion) in 2025, up 27.1 per cent in a single year.
It says this kind of finance is incompatible with limiting global heating to 1.5°C, because new fossil fuel infrastructure can lock in emissions and dependency for years to come.
What are UK banks doing?
The UK picture is uncomfortable. Barclays is ranked eighth globally for fossil fuel finance in 2025, making it the highest-ranked British bank in the report’s main table. It provided $34.1 billion (£25.5 billion) in fossil fuel finance during the year.
Barclays reduced its overall fossil fuel finance by 5.3 per cent compared with 2024. But its finance to companies expanding fossil fuels rose 40.3 per cent.
HSBC and Standard Chartered both increased their overall fossil fuel finance in 2025. HSBC’s rose 16.2 per cent, while Standard Chartered’s rose 27.9 per cent.
Their fossil fuel expansion finance also rose sharply.
| UK bank | Fossil fuel finance in 2025 | Change vs 2024 | Fossil fuel expansion finance in 2025 | Change vs 2024 |
|---|---|---|---|---|
| Barclays | $34.1bn | Down 5.3% | $17.6bn | Up 40.3% |
| HSBC | $15.9bn | Up 16.2% | $8.7bn | Up 36.2% |
| Standard Chartered | $14.4bn | Up 27.9% | $7.9bn | Up 41.7% |
| NatWest | $2.5bn | Down 4.9% | $1.3bn | Up 4.4% |
| Lloyds Banking Group | $1.7bn | Up 37.0% | $350m | Down 60.0% |
This is where ethical banking gets murky. A bank can have a net zero target and still finance fossil fuel companies. It can reduce total fossil fuel finance while increasing finance to companies expanding fossil fuels. It can talk about sustainability while continuing to back parts of the fossil fuel economy.
So the useful question isn’t only ‘does my bank have a climate policy?’, it’s ‘what does my bank still finance?’
Why should bank customers care?
Most of us didn’t choose our bank because of its fossil fuel policy. We chose it because our parents used it, because it had a branch nearby, because we opened an account as a student, or because switching felt like too much admin.
No one needs a guilt trip for having a high street bank account.
But banking is one of the easier ethical money choices to revisit. You don’t need to be wealthy, you don’t need to understand the stock market, and you don’t need to start investing.
You can simply ask whether your bank is using money in a way that broadly matches your values.
Climate change is already feeding through into everyday financial life, from insurance costs and food prices to energy bills, housing and long-term investment risk. Banks remain central to this because they help decide which companies can access finance, and on what terms.
Green claims aren’t enough
The report says the banking sector has now seen two consecutive years of increased fossil fuel finance and a third consecutive year of banks tending to backslide on climate policies.
It points to the collapse of the Net-Zero Banking Alliance in 2025 and says some banks have weakened commitments, widened loopholes or watered down policies for coal, oil and gas.
For customers, that means climate language needs to be treated carefully. Words such as “sustainable”, “responsible” and “net zero” are only useful if they’re backed by clear action. A stronger ethical bank should be able to show what it funds, what it excludes and how those policies work in practice.
The important thing to check is whether your bank has restrictions on fossil fuel expansion. A bank may say it’s supporting the energy transition while still financing companies developing new oil, gas or coal projects.
That’s the gap customers need to watch.
How UK banks compare globally
The report names JPMorgan Chase as the world’s largest fossil fuel financier in 2025, followed by Bank of America and Japan’s Mitsubishi UFJ Financial Group.
Together, the 12 largest fossil fuel banks provided $474.3 billion (£354 billion) in finance in 2025. The report says this accounted for 38.5 per cent of all bank fossil fuel financing across its wider BOCC+ dataset.
Barclays is the only UK bank in this group.
That doesn’t mean other UK banks are off the hook. But it does show how concentrated fossil fuel finance is. A relatively small number of banks are driving a large share of global fossil fuel finance.
Which ethical banks does Good With Money recommend?
For readers who want a clearer ethical alternative, Good With Money regularly highlights banks and building societies that put social and environmental purpose closer to the centre of what they do.
Triodos Bank is one of the clearest options for personal banking. It offers current accounts, savings and ISAs, and says it only lends to organisations delivering positive social, environmental or cultural impact, including renewable energy, sustainable farming, charities and social housing. Triodos also holds Good With Money’s Good Egg mark.
Ecology Building Society is another Good Egg firm. It focuses on sustainable housing and green building, including mortgages that support energy-efficient homes, renovations, self-builds and community-led housing. It also offers savings accounts, so savers can choose a provider with a clear environmental focus.
Unity Trust Bank, also a Good Egg firm, isn’t a personal current account provider, but it’s a strong option for charities, social enterprises and purpose-led organisations. Its lending focuses on organisations creating positive social impact across the UK.
Other providers often cited in ethical banking discussions include Charity Bank, the Co-operative Bank, Coventry Building Society and Nationwide Building Society. The right choice will depend on what you need from an account, how much branch access matters to you, what rates are available and how far you want your money to go on ethics.
The key point is transparency. A good ethical bank shouldn’t leave you guessing what your money is helping to finance.
Should you switch bank?
If your bank is heavily involved in fossil fuel finance, and that doesn’t sit well with you, switching is worth considering.
You don’t have to move everything at once. You could start by moving your savings to a more ethical provider, opening an ethical account alongside your existing one, or switching your current account when you feel ready.
If switching isn’t practical right now, you can still act. Ask your bank what it’s doing to end finance for fossil fuel expansion. Move future savings or business banking to a provider with clearer ethical standards. Support campaigns calling for stronger fossil fuel finance rules.
Banks respond to money, pressure and reputation. Customer choices aren’t the whole answer, but they’re not meaningless either.
What can you do now?
Check whether your current bank appears in the Banking on Climate Chaos report.
If it does, look beyond the headline figure. Is its fossil fuel finance rising or falling? Is it still financing companies expanding oil, gas or coal?
Then compare alternatives. Look for clear lending policies, transparent reporting and evidence that the bank or building society is financing things you’re comfortable supporting.
The new Banking on Climate Chaos report shows fossil fuel finance is still flowing at vast scale. More importantly, it shows some banks are still helping to finance the next wave of fossil fuel expansion.
The hopeful bit is that your money doesn’t have to flow with it.
