So here are some of the products that can have a positive social, ethical or environmental impact:
Even with your day-to-day financial transactions, your money can be working to help causes and industries you believe in. Take the new Triodos Bank Current Account, for example. It allows you to apply your values to your everyday banking, by putting your money to work in a range of ways that support ethical enterprises and initiatives and promote social, cultural and environmental change for the better.
Savings Accounts and Bonds
Savings accounts and savings bonds allow you to deposit your cash and earn a rate of interest. You may need to give notice before withdrawing your money, and usually, the longer the notice period, the higher the interest rate. However, if you save with a business listed on Ethex, your money will be lent on to other positive businesses or individuals, enabling you to support them indirectly, funding their ongoing good work and offering you a lower-risk way of getting a return on your money.
An ISA, or Individual Savings Account, is a tax-free wrapper around savings and investments, meaning you can receive interest without paying tax. There are three different types of ISA: cash; stocks and shares; and innovative finance ISAs. You can invest in several different ISAs up to a maximum of £20,000 in 2017–18.
• Cash ISAs are a tax-free savings account. You can hold more than one cash ISA at a time as long as you do not exceed the maximum ISA limit for the year.
• Stocks and shares ISAs allow you to invest tax-free in stocks and shares.
Innovative Finance ISAs were launched by the government in April 2016 allowing you to hold peer-to-peer investments tax-free.
Investments in shares provide a business with the funding they need to run and are the are the financial foundation underpinning a business. There are three main types of shares on Ethex, all offering you the chance to have a positive impact with your investment:
Transferable shares are issued by companies and can be sold on to another investor through the Ethex secondary market. If you sell your transferable shares, it does not affect the amount of share capital that the business holds. Their value can go up or down and they usually pay a return in the form of dividends from the business’s profits.
Withdrawable community shares are issued by co-operatives. They can give you your money back, but only on terms set by the business. If you sell withdrawable shares you are taking money directly out of the business. Their value usually stays constant, and they pay a return in the form of interest, which may vary over the lifetime of the investment.
Depository receipts are a type of equity investment issued by international social investment organisations, allowing you to hold equity in foreign businesses. You earn a return from the investment, but the risk can be greater than with savings accounts. The funds are usually placed with a dedicated charity which then invests a matching amount in the business.