Published : 2 years ago, on 28/06/2022

By Jørgen Christian Juul, CEO, Cardlay.

It wasn’t that long ago that we carried around cash to pay for everything, whether it was for getting on the bus, paying for our weekly food shop or buying a company meal. Despite credit cards being around since the 1950s, neither they nor debit cards became popular until the ‘90s. At this point, plastic cards quickly became very much part and parcel of everyday life. By the 2000s, they were popular worldwide. 

Even in the era of mass digitalisation, there were over 25 billion payment cards in circulation in 2021, with this number expected to rise to over 30 billion by 2025. In the UK, just 7% of shop payments will be made in cash by 2024, following a cashless global trend — cash payments already account for less than 10% of shop purchases in countries including Sweden, Canada and Australia.

However, despite their convenience, these payment cards come with a massive environmental cost. Here we delve into just how harmful plastic payment cards are for the planet, and the solutions we should be looking to use instead. 

How do payment cards harm the environment?

According to Finder, each year around six billion new plastic cards are produced and issued, with most of them made from PVC. This type of plastic is harmful at every stage of its life cycle (during its production, use and disposal) as it’s made of chlorine and dioxin, both of which release huge amounts of toxic chemicals into the environment.

What’s more, in an interview with Finextra, Michael Donald, Founder and CEO of ImageNPay, discussed that around 5.7 million tonnes of plastic cards end up in landfills each year, where it takes them decades to break down into microplastics. These can then end up being ingested by humans and wildlife, leading to a range of potential health issues as discussed by the Washington Post, from reproductive harm and organ problems, to obesity and developmental delays in children.

Although some cards get recycled, the majority end up in landfill as plastic waste. Aside from the PVC, additives and pigments complicate the recycling process, but ultimately, the lack of financial incentive dictates the abysmal effort made to recycle this plastic. As such, the plastic is either incinerated, dumped in landfills, or finds its way into the oceans. This is unnecessarily harmful considering the number of alternatives now available. So which of these should we be looking towards?

What alternatives should be used instead?

Digital payment solutions

There are so many ways to pay digitally now, removing the need for plastic cards entirely. Some common methods include:

Digital wallets

Instead of having a physical bank card, digital wallets let you use your smartphone to make contactless payments via a virtual card contained within. Virtual cards to be used for all kinds of online payments including in retail, restaurants, etc. around the world making this the largest and most adaptable solution. According to research, over 2.8 billion digital wallets were in use by the end of 2020, with more than one in two people predicted to use them by 2025. 

Peer-to-peer digital payments 

The likes of PayPal and Google Pay are examples of digital peer-to-peer payment solutions. These platforms enable users to search for other people and perform online transactions. Using them can be as simple as obtaining the other person’s email address and sending them money through the platform.

Crypto payments

We could see the end of centralised payments altogether if crypto payments ever become mainstream. Referring to payments relying on cryptocurrency (a decentralised currency not managed by any financial institution), this is run on blockchain technology, which is a completely secure digital infrastructure immune from fraud and theft. All senders need is the recipient’s public address — a string of text given to identify a particular user.

Sustainable payment cards

Alternatively, many payment providers have started releasing cards using more sustainable materials, with examples including:

Wood

Unlike plastic cards, wooden payment cards don’t release toxic chemicals into the environment and are also biodegradable. We’ve seen a number of these products launched in recent years, including from the likes of TreeCard and Tomorrow. The former company even puts 80% of its profits towards reforestation projects, with its cards made from sustainably-sourced and FSC-approved cherry wood. 

Metal 

Payment providers including N26, Monzo and Capital One have released metal cards in the last few years. Although these products do have a large carbon footprint, they are much longer-lasting than their plastic counterparts, reducing waste, while also being a lot easier to recycle. 

Non-PVC plastic

Tridos’s polylactic acid (PLA) bank card is an example of one that’s technically still made from plastic, while being a lot more environmentally-friendly than the standard PVC payment card. Produced from renewable sources like plant leaves and corn instead of petroleum, PLA is biodegradable, recyclable, and non-toxic if incinerated.

So there you have it: plastic card payment pollution explained, as well as a look at how we can move forward and eschew this outdated solution once and for all. We can only hope that these alternative payment methods continue to gain traction in the coming years and decades, helping us to move towards a more sustainable world.