Responsible financing

When granting a loan, the customer’s creditworthiness is calculated on the basis of the information available. We also carefully assess the value of the required collaterals. We try to consider the financial security of the customer and the possibilities for success.

As a part of responsible lending, we consider the interest rate risks in assessing the customer’s repayment ability, offer interest rate hedging products suitable for the customer and encourage the customer to prepare for unexpected events and future acquisitions with continuous saving solutions. Responsible lending also includes explaining the risks so that the customer understands them, as understanding the risks of the project supports the customer’s decision process. At the same time, we strengthen the customer’s financial literacy in our role as a financial coach.

Our responsible way of operating also includes assisting the customer if their ability to pay back the loan has become compromised. When granting a loan, we emphasize the importance of contacting us in case the customer experiences difficulties in making payments. We are often able to find solutions in cooperation with the customer that help the customer overcome the difficult situation.

In corporate lending, the savings banks target reputable micro and small businesses, self-employed entrepreneurs and forestry and agricultural customers as well as public sector operators that are mainly located within the operating area of each savings bank. We provide financing for companies operating in the operating areas of savings banks, thereby promoting employment in the region and enabling the growth and development of local economy for our part. Savings Banks mainly operate locally, and it is the local expertise of the Savings Banks that gives us good opportunities to assess the sustainability of the operations of companies.

An external provider’s service related to sustainable lending is used in the corporate financing activities of the Savings Banks Group. The service is used for checking, among other things, whether the company has been convicted of crime or whether it has been sanctioned by means of any penalty fees.

The sustainable lending process has been integrated into the general lending process. With regard to sustainable lending, potential financing targets in personal and business lending are assessed by using the ESG criteria valid at the time, along with the guidelines for responsible lending. Monitoring the lending process is part of the Savings Banks Group’s general management and control processes, to which the Savings Banks Group’s internal guidelines apply.  

To promote a consistent lending process, the Savings Banks Group’s lending guidelines establish ESG criteria for selected activities which the Group aims to support and which create opportunities for the Savings Banks Group’s customers. Examples of such activities include sustainable agriculture, forestry and fishing, sustainable industry, a sustainable energy sector, a sustainable construction and real estate sector, sustainable transport, storage and wholesale and retail of motor vehicles, and sustainable water and waste management and cleaning.  

The ESG criteria have been established by applying the European Investment Fund (EIF) criteria for sustainable projects, the Green Bond Principles of the International Capital Market Association (ICMA), the EU taxonomy criteria, and market practices, where applicable. The lending guidelines also include more detailed exclusion principles concerning certain industries, including the tobacco and cannabis industries, the production of adult entertainment, the military use of controversial weapons, child labour and payday loan companies. In addition, careful discretion criteria apply to the gambling business, energy companies that make significant use of fossil energy sources, industries with major environmental impacts, large-scale or chemical forestry, animal industry operators engaged in intensive livestock farming that have violations of animal rights on their record, and companies with current legally valid violations of human rights, labour law, environmental law, tax law or competition law that are known to the Savings Banks Group or, otherwise, publicly known. 

Our goal is, by means of conducting an assessment, to identify the credit products of the Savings Banks Group or our partners that are suitable for the customer and their project. We also take sustainable development into account in financing, and we want to support our customers in the green transition.

For instance, responsibility for ecological efficiency and the climate can be realised through various means, with energy loans being one of them. An energy loan can be granted for an energy renovation of a residence or holiday home. An energy renovation can include changing the building’s heating system (from oil heating to geothermal heating, for example), replacing windows and external doors with more energy-efficient products, installing solar panels or adding more insulation. An energy renovation leads to savings in heating costs during the cold season and cooling costs in the summer. 

Read more about energy loans 

Read more about the Kassavahti deposit funding solution for businesses