Carbon Credit Cards: Everything You Need to Know

photo of a brown green tree

As the world inches closer to crossing the 1.5 degrees Celsius temperature limit, it’s becoming clear that our consumption patterns play a pivotal role in influencing the direction of climate change

That’s because our individual actions contribute to our carbon footprint. What we eat, how we travel, and what we choose to buy daily all impact the environment and the planet’s available resources. 

We cannot rely on governments alone to take action – being conscious of where we spend our money can help us choose environmentally-friendly options that protect the planet from further damage.

A recent innovation, sometimes called a ‘carbon credit card’, is a tool that helps mitigate the carbon footprint of an individual’s purchases, while still offering the many of the perks and services of regular credit cards. 

The Aspiration Zero credit card is a great example of a carbon credit card on the market right now. We plant a tree every time you make a purchase, let you round up to plant one too, and provides up to 1.00% cashback on all purchases (see terms and conditions).

Read on to learn all about carbon credit cards.

What is a carbon credit card?

A carbon credit card is a credit card that helps the user mitigate their carbon footprint, like how Aspiration plants a tree for each purchase made using the Zero credit card. Other carbon credit cards might help mitigate a person’s footprint in other ways, such as limiting purchases based on levels of CO2 emissions.

Some of these credit cards are go a step further by being made from recycled ocean plastics or bio-sourced materials that degrade easily, such as corn and polylactic acid. They may also be printed using special ink made from recycled air pollution particles such as soot from chimneys and car exhaust pipes. 

How does a carbon credit card work?

Carbon credit cards work just like regular credit cards. They provide credit lines and are subject to annual percentage rates (APRs). The only difference is that carbon credit cards offer special eco-friendly perks that encourage customers to spend responsibly.

Unlike regular credit cards that simply show you the purchases you’ve made each month, carbon credit cards provide you with a report of the carbon emissions associated with your spending. The card calculates the carbon impact of each transaction using a cloud-based climate impact index that shows the amount of CO2 emitted by your spending in proportion to the national carbon limit.

Why You Should Consider Applying for Aspiration Zero

From our co-founder and CEO Andrei Cherny, the Aspiration Zero card is the “only card that rewards you for taking miles off of the planet”, unlike regular credit cards that encourage you to spend money on air travel and petrol for points. Every month that an Aspiration Zero cardholder reaches carbon zero, we reward them with a 1% cashback on their purchases. 

As mentioned above, each time a customer makes a purchase using their Aspiration Zero card, they have a tree planted on their behalf through one of our global reforestation partners. Cardholders can also plant a second tree with each purchase if their Zero card is linked to our Plant Your Change program (see more details here).

Our goal is to reward customers that, through using their card, plant about 60 trees per month – which is considered to be the number of trees required to mitigate the average American’s monthly carbon footprint. 

The Aspiration Zero card is the latest product in our Clean Money lineup. Other products include our Spend and Save high-yield savings account that has helped millions of customers track their climate impact and support sustainable businesses, and the Aspiration Redwood Fund that invests in companies who do well on ESG factors.

Future uses of the carbon credit card

Carbon credit cards are still a very recent innovation. They may be further developed to help people make environmentally-friendly purchases a regular habit. 

One potential improvement that carbon credit cards could see is the introduction of carbon credits that are linked to nationally determined carbon prices. 

The government may deposit a certain number of these credits into people’s accounts each year for them to spend on carbon-intensive products such as petrol, meat, and fossil fuel-generated electricity. 

Once the allocated carbon credits have been used up, people can buy them from other people or the government. But if they have a surplus at the end of the year, they may be able to cash out their remaining credits for personal use.

The hope is that by putting a price on carbon and creating easily exchangeable carbon credits, individuals will be more inclined to purchase products and services that generate low amounts of carbon emissions.

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