India’s Green (Credit) Card

Last sunday, my Friend who lives on the 104^th floor in Mumbai called me and my Professor Friend for a breakfast. I don’t know how many of you know about my Friend on the 104^th floor.

He is the richest individual on the earth today. His wealth is estimated to be more than the assets of Ambanis, Tatas, Birlas and the like – all put together. He pays income tax equivalent to the annual budget of the Municipal Corporation of Greater Mumbai.

But a humble man that he is, he shuns from the media and is a very shy personality. Except the PM, HM and FM, nobody knows him well enough, especially the role he plays in India’s “circulating” economy. My Friend calls us for a breakfast once in a while whenever he is to announce a “breaking news”. So, we were all excited to see him on the Sunday.

When we were ushered in his spacious breakfast room, we saw him sitting on the table with freshly squeezed juices made from the Valencia Oranges of California with oats in the bowl that were supplied by Bob’s Red Mill.

“Gentlemen, Good morning. What can I get for you?” He asked and his Chef Joel Robuchon with 31 Michelin Stars walked in to take our order. After a brief discussion, we settled for spinach and mushroom egg white frittata with gluten free toasts and an American coffee with hot organic milk on the side. Breakfast on 104^th floor has always been a delight as at this height we see a blue sky as we are sitting above the city’s polluted grey canopy.

“I wanted to tell you that I am launching Green Credit Cards in India”. My Friend announced his breaking news. He explained that when he was in the Jeju island in Korea with the Korean PM, he learned about Korea’s success story on Green Credit Cards.

For those who don’t know about the Green Credit Cards of Korea, let me explain a bit.

The Korean Ministry of Environment and the Korea Environment Industry and Technology institute introduced the Green Credit Card and today more than 15 million cards are used by 55% of the economically active population of Korea. Green Credit Card users are rewarded with points that are converted into cash or can be donated to environmental funds when they buy eco-friendly products, use public transport, make paper-less transactions, and consume less electricity, water, and gas. The Green Credit Card also offers discounts for electric car charging services and the purchase of recycled automobile parts. Furthermore, it nurtures the market for low-carbon products and services, thus driving eco-innovation and shifting to a low-carbon economy. The Green Credit Card is the world’s first nation-wide initiative that uses a credit card platform to provide various economic rewards for eco-friendly behaviours.

My Friend continued. He told us that today the eco-friendly products eligible for the Green Credit Card rewards in Korea is 1,957, and the number of participating corporations is 224.

I thought this was rather impressive.

My Friend asked us whether India has certified eco-friendly products. I said Yes and Professor said No.  My Friend wasn’t surprised with such a mixed response.

“This is the first challenge that both of you should help me to resolve”. My Friend said this with a mischievous smile.  He continued.

Did you know that the Green Credit Card in Korea is not just a Card but an ICT tool, to monitor and manage the consumption of goods and services that emit greenhouse gases? This one-card platform monitors various areas such as product consumption, transportation, and energy use in the residential sector. The economic rewards of good behaviour and low carbon consumption are converted into cash points called Eco-Money Points and accumulated in the credit card system, to be redeemed later for cash or to be used in various ways.

I was aware about the one-card platform system. It is estimated that in Korea about 2.5 million tonnes of CO₂ equivalent emissions have been reduced between the onset of the program in July 2011 and December 2016. Indeed, the Green Credit Card directs people’s consumption patterns towards a low-carbon lifestyle and sustainability.

Korea’s Green Credit Card differs from other cards such as Sustain: Green MasterCard issued by Commerce Bank, where part of the profits made are put for some environmental and social cause e.g. promoting reforestation efforts in Brazil, thereby reducing greenhouse gas emissions and fighting climate change. Credit cards like sustain: Green MasterCard were more of a philanthropy and followed carbon offsetting route and did not attempt to influence the production-consumption patterns. Besides, as many critiques say, such types of cards may backfire by encouraging overconsumption!

“Both the PM and FM have asked me to step in and take a lead in launching Green Credit Cards in India”. My Friend said while wiping his face with a napkin that was GOTs certified. “According to them, introduction of Green Credit Cards, will step up sustainable consumption and will lead to innovations in production. India’s looming economy will be restored while addressing the environmental concerns.

I thought the PM and FM were absolutely right. The idea though not original was great. All we needed to do is define what is a green product. My Friend said he will be investing in all those companies who are already making or have potential to manufacture green products. Very clever I thought. He asked us to help him in the difficult task of defining what is green?

“But I want to be different from the Korean Green Credit Card” My Friend wanted to clarify. He said that in his schema of Green Credit Cards, while you may score Eco-Money Points by shopping green products, you may lose the Eco-Money Points, if you consumed or bought products that are in the “Red list”. What a clever idea I thought. This will certainly discourage production and consumption of products that have significant environmental footprints.

“So, you want us to prepare a Red List as well?” Professor asked my Friend while lighting his cigar.

“You got it Professor – I need from you the Green and Red lists” My Friend responded in an excited tone.

I wanted to make however another suggestion. One of the latest additions to the bandwagon of Green Credit Cards is idea floated by a Swedish green start-ups Doconomy. Doconomy is a fintech company founded in 2018 by Johan Pihl and Mathias Wikström with the aim of making banking more eco-friendly and consumers more aware of the environmental consequences of their spending and lifestyle. In 2019, Doconomy came with a DO Black Credit Card as the “world’s first credit card with a carbon limit.” This implied that you could not use DO Black Credit Card if your quota of GHG emissions was over! DO Black was to be released in Sweden in 2019 later this fall with the European market to follow in the first quarter of 2020.

So, when I suggested the concept of DO Black Credit Card, my Friend was even more excited and asked us to come up with a realistic carbon limit to a typical Indian urban consumer.  He said he will buy out Doconomy.

While both of use knew that getting a green and red list done and to calculate a reasonable limit to carbon emissions for an Indian consumer was not going to be easy, we thought of giving a shot and not discourage my Friend.

As we were about to leave, my Friend received a call on his mobile phone that had no telephone number displayed on its screen.

There was a hush hush conversation with someone very important and we couldn’t hear anything what was being said or heard.

My Friend put the phone down and spoke with a strained face

“Gentlemen, we will have to change the name of this proposed Card. I have been told that many States in India especially those in the North East may think that we are issuing a Green Card that will regularize their stay like what is understood in countries like the United States by the term Green Card. It will be hard to explain the difference between the Green (Credit) Card what I am proposing. PM and HM don’t want to take any “risk”. What’s your suggestion?

We understood the complication and advised our Friend to differ this ambitious project of Green (Credit) Card. This problem was perhaps much more complex than making a list of “green” and “red” products!

Do you think Green Credit Cards in India will work? Post me me your views/suggestions.

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