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American Journal of  Environmental
Economics (AJEE) 

Green Literacy, Green Loyalty and Satisfaction among Banking Customers in Kerala: 
Insight from Kerala Gramin Bank and State Bank of  India

Jiji N.1, Sreelakshmi Kacheri Parambath2, Aswin Prakash2, M. V. Praveen2*

Volume 4 Issue 1, Year 2025
ISSN: 2833-7905 (Online)

DOI: https://doi.org/10.54536/ajee.v4i1.3670
https://journals.e-palli.com/home/index.php/ajee

Article Information ABSTRACT

Received: August 19, 2024

Accepted: September 25, 2024

Published: February 20, 2025

The banking industry has embraced green banking to reduce environmental impact amidst 
a growing emphasis on sustainability. Kerala has consistently ranked first in India in the 
Sustainable Development Goals (SDG) index. Against this backdrop, a combined as well 
as comparative study was initiated in the Kerala context to examine how customers’ green 
literacy influences their loyalty towards one largest commercial banks, the State Bank 
of  India and one Regional Rural bank, Kerala Gramin Bank. 200 customers from both 
banks in Kozhikode District participated through Simple Random Sampling, providing 
data via surveys and interviews. Ethical standards were followed with informed consent, 
confidentiality, and voluntary participation. Data analysis included descriptive statistics, 
One-Way ANOVA, T-test, and Pearson correlation. Results show high green literacy in 
Kerala, impacting loyalty. The study underscores the existence of  significant differences in 
satisfaction rates with the green banking practices of  both banks. State Bank of  India scored 
a higher rate of  satisfaction in ease of  using green services, green banking information 
clarity, and the availability of  ample green products, while Kerala Gramin Bank excelled in 
staff  assistance in green banking services. Study suggests for imparting more green literacy 
among bank customers for fostering green loyalty in banking.

Keywords

Green Banking, Green Literacy, 
Green Loyalty, Perceived 
Benefits, Satisfaction, SDG

1 Government College Madappally (affiliated to the University of  Calicut), India
2 Department of  Commerce, Govt. College, Madappally, Kerala, India
* Corresponding author’s e-mail: praveenmvneelambari@gmail.com

INTRODUCTION
Green banking has emerged as a prominent trend in the 
financial sector, emphasizing sustainable technologies 
and environmentally-friendly initiatives (Ellahi et al., 2021; 
Ahmad et al., 2013). This shift reflects a growing recognition 
of  the importance of  clean energy, reforestation projects, 
and carbon offsets in combating climate change. Green 
banking has gained significant traction among financial 
institutions, particularly after the Paris Climate Agreement, 
positioning itself  as a critical component in promoting 
sustainable development (Leonard, 2014). According to 
Hermawan & Khoirunisa (2024), green banking involves 
implementing practices that promote environmental 
sustainability and this includes financing renewable energy 
projects, supporting reforestation efforts, and offering 
products that encourage sustainable consumer behaviour. 
Green banking will remain crucial in advancing a green 
economy as India works towards meeting its Sustainable 
Development Goals by 2030 (Sarkar & Latta, 2022).  
Green banking measures, like green loans and managing 
environmental risks, are essential for aligning financial 
sector activities with sustainability objectives. They 
urge banks to back initiatives that prioritize renewable 
energy, energy efficiency, and sustainable agriculture 
(Doe & Smith, 2021). Green literacy is a new idea that 
goes beyond standard information literacy to include 
environmental sustainability within library operations and 
learning. It includes changing library services, resources, 
and teaching to encourage environmentally friendly 
actions and knowledge (Kurbanoglu & Boustany, 2014; 
Vyas & Parmar, 2021). In regions with high literacy 

rates, such as Kerala, there is a notable penetration of  
green banking awareness among customers (Praveen & 
Harina, 2022). Green loyalty, a crucial factor influencing 
consumers’ sustainable purchasing behavior, has gained 
increasing attention in recent years (Zhang et al., 2023). 
Research shows that green perceived value, satisfaction, 
and trust positively impact green loyalty, both directly and 
indirectly (Chen, 2013).
The State Bank of  India (SBI), the largest commercial 
bank in India, initiated green banking in 2007 with 
policies like the Green Banking Policy, Green PIN, Green 
Fund, and Green Rupee Term Deposit. They installed 
windmills, financed renewable energy projects, and were 
a CDP signatory. SBI aimed to promote sustainability and 
address climate change through various initiatives under 
their green banking framework (Rahman et al., 2023). 
Kerala Gramin Bank (KGB), a popular Regional Rural 
Bank, sponsored by Canara Bank (4th largest public sector 
bank in India),  launched its Green Banking initiative in 
2015, aimed at promoting eco-friendly banking practices, 
including paperless transactions and energy-efficient 
operations (Kerala Gramin Bank, 2015). Both KGB and 
SBI have undertaken various green banking initiatives: 
Gramin Bank focuses on community-based projects, 
including microfinance for renewable energy installations 
and agricultural loans for sustainable farming practices 
(Rajput et al., 2014). The bank’s grassroots approach aims 
to directly benefit local communities and the environment 
(George & Rashmi, 2021). On the other hand, the SBI 
has a broad range of  green banking initiatives, such as 
green bonds, loans for electric vehicles, and investment 



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in large-scale renewable energy projects. SBI leverages its 
extensive network to promote sustainability on a national 
scale (Deka, 2015). Therefore, this study focuses on 
understanding how green (banking) literacy among SBI 
and KGB customers enhances their satisfaction, green 
loyalty, and intention in both combined and comparative 
approaches.  As customers in Kerala are generally known 
to be enlightened, an understanding on their green 
literacy, perceptions and satisfaction on green banking 
practices, and consequential loyalty are crucial for the 
successful implementation of  sustainable practices. 
Factors influencing customer acceptance and support 
include awareness and knowledge, trust and transparency, 
and perceived benefits (Rai et al., 2019). Customers 
who are well-informed about environmental issues 
and green banking practices are more likely to support 
and engage with green banking initiatives. Trust in the 
bank’s commitment to sustainability and transparency 
in their practices enhances customer confidence and 
loyalty (Ibe-enwo et al., 2019). Additionally, customers are 
more inclined to support green banking if  they perceive 
tangible benefits, such as cost savings, improved service 
quality, and positive environmental impact (Herath & 
Herath, 2019).

Problem Statement
With growing environmental worries and the rising 
significance of  sustainable practices, banks are 
implementing green banking initiatives to support 
environmental protection and sustainability efforts. 
Nevertheless, the success of  these programs greatly 
relies on how customers perceive and accept the banks’ 
endeavors. Besides, it is generally accepted that the 
customers in Kerala has 100 percent literacy and a very 
high level of  financial literacy. But no studies related to 
green or green banking literacy of  consumers seem to 
have been conducted. Hence, the objective of  this research 
is to examine and compare the existing green banking 
literacy of  customers and its effect on green banking 
loyalty towards SBI and KGB. It also evaluates perceived 
green banking benefits and customers satisfaction with 
green banking practices.

LITERATURE REVIEW
The banking industry has a vital role in integrating 
ecological factors into lending standards to maintain 
a balance between economic development and 
environmental preservation (Sahoo & Nayak, 2007). 
Kavitha and Rani (2016) emphasized the importance of  
banks in India taking an active role in promoting a greener 
economy. Green banking combines traditional and digital 
banking practices, focusing on ethical operations. By 
transitioning manual transactions to digital platforms, 
banks are able to save time, energy, and resources. Banks 
are now encouraging environmentally friendly practices 
among customers through online bill payments, fund 
transfers, and other options (Agarwal & Yajurvedi, 2022).

Green Banking and Its Importance
Green banking initiatives not only provide environmental 
benefits but also result in cost savings for banking 
operations (Jayadatta, 2017). Gulzar et al. (2024) and Bhat 
et al. (2022) highlighted the crucial importance of  banks 
in advancing environmental sustainability and fostering 
low-carbon economies via green banking. In the same 
way, Choubey and Sharma (2022) pointed out that green 
banking improves brand reputation and trust through the 
use of  eco-friendly products and sustainable practices. 
Dhamija and Sahni (2021) centered their study on how 
customers perceive and their willingness to embrace 
green banking, whereas Herath and Herath (2019) 
constructed a theoretical framework connecting green 
banking attributes to customer contentment. Overall, 
green banking is seen as a beneficial mechanism for both 
banks and customers, contributing to environmental 
sustainability and development (Praveen & Harina, 2022). 
Ragupathi and Sujatha (2015) pointed out the growing 
importance of  banks in promoting environmental 
sustainability, and talked about the shared advantages of  
green banking for banks, industries, and the economy. 
Saho and Singh’s (2016) study focused on the impact of  
green banking on reducing stress in bank workers. Jayabal 
and Soundarya (2016) highlighted the possible financial 
gains of  green banking despite initial hurdles.  Nath et 
al. (2014) suggested the implementation of  electronic 
banking and other environmentally conscious measures. 
Several research papers (e.g., Dhamija & Sahni, 2021; 
Herath & Herath, 2019) center on customer opinion and 
contentment regarding green banking, yet there is limited 
investigation into the various obstacles (e.g., psychological, 
technological, financial) hindering the broader utilization 
of  green banking services. Banks that practice green 
banking comply with regulations and improve their 
reputation. Customers now prefer banks with green 
initiatives, leading to greater customer loyalty and financial 
stability in the long run (Lee & Martinez, 2020).

Determinants of  Green Banking Awareness and 
Adoption 
Awareness and adoption of  green banking practices are 
influenced by factors such as age, gender, and occupation. 
These demographic traits play a crucial role in shaping 
customer perceptions and responses to green banking 
(Praveen & Harina, 2022). De Silva (2019) talked about 
how green banking can help reduce environmental 
impact and enhance resource efficiency. Giramkar, S 
(2018) suggested the need for increased awareness of  
green banking among older adults. Deepa and Karpagam 
(2018) observed that although customers are informed 
about alternative energy, awareness about green banking 
is lacking. Risal and Joshi (2018) found that the use of  
innovative, environmentally friendly banking technologies 
has a positive effect on environmental sustainability in 
Nepal. Menon et al. (2017) examined India’s transition 
to green banking for social responsibility, while Raj and 



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Rajan (2017) highlighted the importance of  increasing 
customer awareness to enhance the impact of  green 
banking initiatives. 

Green Literacy
Green literacy expands traditional information literacy 
to incorporate environmental sustainability (Kurbanoglu 
& Boustany, 2014). Green libraries aim to reduce 
their environmental impact through energy-efficient 
designs, sustainable collections, and educating users 
on environmental issues. Librarians can play a key role 
in promoting sustainability literacy to address global 
challenges (Vyas & Parmar, 2021). In order to advance 
sustainable development through green banking, it is 
essential to raise green literacy among both internal 
and external stakeholders and provide education on the 
topic (Tandon & Setia, 2017). This method helps in the 
shift towards a sustainable economy and industry (Dipti 
Gadhavi et al., 2023).

Green Loyalty
In recent years, there has been a growing focus on green 
loyalty as a significant element that impacts consumers’ 
decisions to make sustainable purchases (Zhang et al., 
2023). Studies indicate that positive green perceptions, 
satisfaction, and trust have a beneficial effect on green 
loyalty, whether through direct or indirect means (Chen, 
2013). On the other hand, green image, trust, and 
satisfaction are all negatively impacted by green perceived 
risk (Chrisjatmiko, 2018). Research has also examined 
how value orientations influence green loyalty, finding 
that egoistic and biospheric values have a positive impact 
(Imaningsih et al., 2019) and the researchers later stated 
that value orientations influence green loyalty through 
the mediating factors of  green functional benefits and 
monetary costs. In order to increase customers’ loyalty 
towards environmentally friendly products, businesses 
should work on enhancing the perceived value, 
satisfaction, and trust in green options, instead of  focusing 
on non-green alternatives (Chen, 2013). Understanding 
these connections and integrating appropriate values 
into marketing plans can assist companies in efficiently 
endorsing eco-friendly products and cultivating customer 
allegiance during the ecological era (Imaningsih et al., 
2019; Chen, 2013). In tune with findings of  Le (2023), 
it may be stated that eco-friendly corporate image of  an 
organization has a significant influence on customers’ 
green loyalty.

Gaps in Existing Research 
Current studies on sustainable banking emphasize how 
it contributes to sustainability, boosts brand image, and 
increases customer approval. Yet, there are still important 
gaps to address, such as the requirement for practical 
methods to assess the customers’ green literacy rate and 
its effect on green loyalty towards eco-friendly banking 
practices, as well as tactics for raising customer satisfaction 
and intention. Tackling these deficiencies could lead to a 

better understanding of  how to improve green banking 
methods and boost their impact on environmental and 
financial sustainability.

MATERIALS AND METHODS
Based on the comprehensive literature survey and 
research gap found this study analyzes customers’ green 
literacy, green loyalty, perceived green banking benefits 
and satisfaction on green banking practices in SBI and 
KGB. The study follows a combined- comparative 
approach. It is combine approach as the variables, green 
literacy, green loyalty, perceived green banking benefits 
and green banking satisfaction etc., are studied by 
combining customers of  both banks (200 respondents). 
It is comparative when it analyses the differences in 
satisfaction of  customers towards the green banking 
practices of  both banks (100 respondents each). 
The specific objectives of  the study are:

1. Understand the green (banking) literacy and loyalty 
of  SBI and KGB

2. Examine the customers’ perception towards the 
benefits of  green banking

3. Analyze the customer satisfaction on green banking 
initiatives of  SBI and KGB

4. Analyze the relationship a between green literacy and 
green loyalty

5. Compare the green banking practices and resultant 
customer satisfaction of  SBI and KGB
The study’s research design is primarily descriptive. The 
sample design includes 200 customers in total, with 100 
customers from Gramin Bank and 100 customers from 
SBI Bank. The research utilizes a simple random sampling 
method to gather information from participants, and the 
study specifically focuses on the Kozhikode district in 
Kerala. Information was gathered via a formal survey, 
dispersed electronically and in print to guarantee a varied 
group of  participants. Both primary and secondary 
sources are utilized in the process of  collecting data. 
Information provided by customers in surveys and 
interviews is considered primary data, whereas secondary 
data is collected from published studies, financial reports, 
and bank reports. The survey addressed important topics 
like awareness, attitude, and embrace of  eco-friendly 
banking methods, along with possible obstacles to its 
approval. It utilized closed-ended questions and Likert’s-
scale items to assess attitudes and behaviors. Additional 
inquiries were initiated to evaluate the level of  support 
from the organization in promoting green banking among 
selected banks. Statistical analysis consists of  summarizing 
important variables with descriptive statistics, and then 
using inferential statistics, One-Way ANOVA and T-tests, 
etc., for examine the association and differences between 
factors like awareness, perception, and adoption behavior. 
The study also uses tables and charts, as well as statistical 
methods like for data presentation.
To uphold ethical standards, individuals had to provide 
informed consent and were assured confidentiality and 
voluntary participation. However, the study acknowledged 



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limitations like potential bias in sampling from utilizing 
convenience sampling and the chance of  bias in self-
reported responses. Despite the constraints, the study 
aimed to provide valuable insight on the adoption of  
green banking and its impact on customer and vice versa.

RESULTS AND DISCUSSION
Result
This part consists of  6 sub sections which depicts and 
discusses demographic particulars of  green banking 
customers, their green banking literacy level (Green 
Literacy), green banking customers’ attitudinal loyalty 

(Green Loyalty), green banking satisfaction, green 
banking perceived benefits, and hypotheses testing.

Demographic Profile of  Respondents
Primary data of  the study were collected from the 
respondents of  customer’s behavioral intention and 
loyalty towards green banking practices in SBI and 
Gramin Bank, which together contribute a total of  200 
customers. The demographic profile of  respondents 
concerning gender, age, monthly income and 
employment status are very essential for the analysis of  
perception of  customers.

Table 1: Demographic profile of  respondents (combined form)
Category Frequency Percentage
Gender Male 112 56

Female 88 44
Other 0 0
Total 200 100

Age 18-25 108 54
26-35 60 30
36-45 12 6
Above 45 years 20 10
Total 200 100

Monthly Income Below 25000 98 49
25001 - 50000 50 25
50001 - 75000 28 14
Above 75000 24 12
Total 200 100

Employment Status Employed 122 61
Unemployed 0 0
Student 42 21
Retired 17 8.5
Other 19 9.5
Total 200 100

Source: Primary Data

The demographics (Table 1) show that the study sample 
has an even split between genders, with 56 per cent being 
male and 44 per cent being female. A large percentage (54 
per cent) of  participants falls within the 18-25 age range, 
with 30 per cent in the 26-35 categories. Almost half  of  
the participants (49per cent) earn less than ₹25,000 per 
month, whereas a small percentage (12per cent) makes 
more than ₹75,000. 61 per cent of  participants are 
employed public and private sectors, while 21 per cent 
are student customers. No participants are unemployed. 
Retired persons constitute 8.5 per cent, while 9.5 percent 
belongs to other occupation categories. The demographic 
profile of  green banking customers reveals a nearly equal 

gender split, with a youthful majority. Majority of  sample 
respondents belongs to low and middle income class. As 
a result, this study can be seen as reflection of  behavioral 
intention and loyalty on green banking mainly among 
youth and middle class earners.

Banking Customers’ Green Literacy
To study the customer’s green literacy and education on 
sustainable banking practices of  Kerala Gramin bank and 
SBI, given 4 statements to respond on 5 point Likert’s 
scale: strongly agree, agree, neutral, disagree, and strongly 
disagree. The response are collected were tabulated in the 
Table 2.



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Table 2 reveals that most respondents are knowledgeable 
and self-assured when it comes to green banking practices. 
The table presents insights on respondents’ views on 
green banking practices using a Likert’s scale, focusing 
on their green literacy (Kurbanoglu & Boustany, 2014). 
A majority of  participants show high awareness (mean 
4.10), understanding (mean 4.32), and satisfaction with 
the green banking information provided by their banks 
(mean 4.12). However, some respondents feel unsure 
about their knowledge of  carbon footprint reduction 
(mean 4.03), suggesting room for improvement through 
education. Most participants generally agree, with scores 
above 4.0, that they are informed about their bank’s 
environmentally-friendly efforts, comprehend the 
ecological advantages, and believe their bank furnishes 
adequate details on participating in these actions. 
Moreover, participants are confident in their capacity 
to decrease their carbon footprint by utilizing green 
banking services, indicating a close match between 
customer awareness and their banks’ environmental 
objectives and relatively high level of  green literacy 
rate among banking customers highlighted by the 
resultant data. Awareness of  environmental risks from 

non-eco-friendly banking is rated at an average score 
of  3.81, ranging from moderate to strong. Regarding 
environmental education, most respondents have 
been taught about the environment in school, which is 
evident from the high average score, 4.42. In the case 
of  government communication of  sustainability, even 
though most individuals admit to getting eco-friendly 
messages from government and other agencies, there 
are differing views, with some dissenting or staying 
impartial, average rating stood at 3.92. Overall, the 
findings indicate that environmental education is 
common, but there may need to be a greater emphasis 
on raising awareness about certain environmental risks, 
such as those associated with non-eco-friendly banking, 
by educational and government institutions.

Customers’ Green Loyalty
To analyze the customer’s Green loyalty towards green 
banking on preference level of  customer’s on Kerala 
Gramin bank or SBI, seven statements are given to 
respondents to answer on Likert’s scales, ranging from 
strongly disagree to strongly agree. The response are 
tabulated in Table 3

Table 2: Customers’ green literacy and education (Combined form)
Statements SD D N A SA Total Mean
 I am aware of  the green banking practices offered by my bank. 0 25 8 89 78 200 4.10
I understand the environmental benefits of  participating in green 
banking initiatives.

0 40 12 92 76 200 4.32

My bank provides sufficient information on how to engage in 
green banking.

0 23 11 86 80 200 4.12

I feel confident in my knowledge of  how green banking 
practices can reduce carbon footprint.

0 19 24 90 67 200 4.03

I know the environmental threats of  non- green banking 18 21 10 83 68 200 3.81
I got some environmental education in my schools or 
colleges(geography/geology/EVS)

0 9 19 102 80 200 4.42

Govt.  Provides me green awareness messages through various 
agencies (local bodies/ kudumbasree/Haritha karma sena etc.)

15 17 15 76 77 200 3.92

Source: Primary Data

Table 3: Customers’ Green loyalty towards green banking (Combined form)
Statements SD D N A SA Total Mean
I prefer to use banking services that are environmentally friendly 8 21 9 72 100 200 4.26
I am willing to pay higher fees for banking services that promote 
environmental sustainability.

12 12 12 90 76 200 4.10

I actively seek out information about my bank's environmental initiatives. 0 20 9 81 88 200 4.20
I feel more loyal to banks that have strong environmental policies 3 17 13 92 72 200 4.12
I would recommend a bank with green practices to my friends and 
family.

13 14 10 90 74 200 4.10

I am likely to continue using my bank if  it adopts more 
environmentally friendly practices

5 20 8 83 84 100 4.18

I believe my bank's commitment to green practices reflects its overall 
integrity and values

10 16 16 86 72 200 4.10

Source: Primary Data



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The data from the customers green loyalty (Table 3) 
shows that customers have a strong preference for 
using eco-friendly banking services, demonstrated by 
a high mean value of  4.26. Nevertheless, they are more 
hesitant to suggest a bank with environmentally friendly 
practices to their friends and relatives, and have doubts 
about whether a bank’s dedication to green practices truly 
represents its overall honesty. However, they are prepared 
to pay increased costs for banking services that support 

eco-friendliness, averaging at 4.10, which reflects the 
environmental concern of  banking customers. 

Green Banking Satisfaction
To analyze the customer’s satisfaction level with four 
statements given to respondents to answer in Likert’s 
scale: strongly disagree, disagree, neutral, agree, and 
strongly agree. The following is depicted in Table 4 and 
Figure 1.

Table 4: Customer’s satisfaction towards green banking services (Combined form)
Statements SD D N A SA Total Mean
Convenience of  using Green Banking services 34 66 20 52 28 200 2.87
Clarity of  green banking Information 26 62 12 60 40 200 3.13
Staff  Assistance for using green banking 25 55 9 68 32 200 2.97
Availability of  ample green banking products 9 31 10 84 66 200 3.84

Source: Primary Data

Figure 1: Customers’ satisfaction on Green Banking Practices

The customer satisfaction data for green banking services 
shows different levels of  satisfaction for various factors. 
Customers are very satisfied with the availability of  
green banking products, given the average score of  3.84, 
showing their approval of  the range of  green banking 
products provided. Green banking information clarity 
received a mean score of  3.13, indicating that although 
it is quite clear, there is still room for enhancement. Yet, 
there is a decrease in satisfaction when it comes to staff  
assistance to use green banking services and convenience 
of  using green banking services, averaging at 2.97 and 

2.87, raising relatively an issues about service conduct 
and the general convenience of  utilizing these services. 
This indicates that, although customers value the variety 
of  products offered, there is a need for improvement in 
customer service interactions.

Perceived benefits of  Green Banking
This section intent to reveal what the benefits available 
to the banks are as perceived by the customers, when 
their transacting bank follows green banking practices. 
Customers’ responses are tabulated in Table 5.

Table 5: Perceived benefits on green banking (Combined form)
Statements SD D N A SA Total Mean
Knowing my bank’s efforts in promoting sustainability, I will 
recommend my banks to others 

0 12 34 40 112 200 4.24

My bank's green practices enhance my overall satisfaction with the bank 4 18 30 48 100 200 4.14
I feel more loyal to my bank due its fits commitment to green practices 0 8 44 60 88 200 4.14
The green banking initiatives of  my bank positively influence my 
decision to continue the bank

5 6 52 44 96 200 4.08

Source: Primary Data



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The data shows a strong belief  in the positive impact of  
the green banking practices. 74 per cent of  respondents 
strongly agree or agree that they would be inclined 
to recommend the bank because of  its sustainability 
initiatives, with an average rating of  4.24. In the same way, 
70 per cent of  participants support or strongly support 
the idea that the eco-friendly actions of  the bank improve 
their overall satisfaction with their banks, resulting in 
an average score of  4.14. The bank’s environmentally 
friendly practices positively impact loyalty as shown by 74 
per cent agreement and a mean score of  4.14. Moreover, 
68 per cent of  participants affirm or strongly affirm that 
the bank’s environmentally-friendly initiatives influence 
their choice to keep utilizing its services, leading to an 
average of  4.08. In general, the bank’s dedication to 

sustainability noticeably improves customer satisfaction, 
loyalty, and advocacy.

Testing of  Hypotheses
There are two set of  hypothesis formulated for this study, 
one is to test there any variation in the green practices 
and initiatives between SBI (A nationalized Commercial 
Bank) and Kerala Gramin Bank( A Regional Rural Bank 
in Kerala)

Differences in Green Banking Practices of  Banks 
Selected (Comparative Form)
H01: Customer Satisfaction with Green Banking Practices 
is Not Statistically Different between Customers of  SBI 
and Gramin Bank

Table 6: Group Statistics for t-test
Preference of  The Bank N Mean Std. Deviation Std. Error Mean

Customer Satisfaction Kerala Gramin Bank 100 5.18 1.587 .224
SBI 100 6.22 1.888 .267

Table 7: Independent t-test
Levene’s Test 
for Equality of  
Variances

t-test for Equality of  Means

F Si
g.

t df Si
g.

 
(2

-t
ai

le
d)

M
ea

n 
D

iff
er

en
ce

St
d.

 E
rr

or
 

D
iff

er
en

ce 95% Confidence 
Interval of  the 
Difference
Lower Upper

Customer 
Satisfaction

Equal variances 
assumed

.077 .782 -2.982 98 .004 -1.040 .349 -1.732 -.348

Equal variances 
not assumed

-2.982 95.19 .004 -1.040 .349 -1.732 -.348

Source: Compile by authors

The independent samples t-test is applied to compare 
the satisfaction level of  customers of  SBI and Gramin 
Bank towards green banking practices. The test results 
show t-statistic of  -2.982 and p-value of  0.004. Since 
the p value is less than 0.05, the null hypothesis is 
rejected at the 5per cent level of  significance and an 

alternative hypothesis is accepted. Hence Customer 
satisfaction with green banking practices is statistically 
different between customers of  SBI and Gramin Bank. 
Further, the mean score of  customer satisfaction on 
green banking practices were analyzed for these two 
banks and given in Table 8.

Table 8: Mean score analysis between banks (Comparative Form)
Satisfaction Factors Samples Mean Score

SBI KGB SBI KGB
Convenience 100 100 3.11 2.63
Clarity of  Information 100 100 3.38 2.88
Bank Staff  assistance 100 100 2.92 3.02
Ample Green banking products 100 100 4.27 3.41
Combined Mean Score 3.42 2.99

Source: Primary Data

The data in the table 7 displays customer satisfaction 
ratings for four green banking factor in banking services 
offered by two banks: State Bank of  India (SBI) and 

Kerala Gramin Bank (KGB). Every category indicates 
the banks’ performance regarding convenience, clarity 
of  information, Assistance from bank staff, and 



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green banking product accessibility. Regarding ease or 
convenience, SBI has a mean score of  3.11 which is 
higher than KGB’s mean score of  2.63. When it comes to 
convenience, customers appear to be more satisfied with 
SBI’s eco-friendly banking initiatives. Regarding clarity 
of  information, SBI continues to outperform KGB with 
a score of  3.5 compared to KGB’s score of  2.9. This 
indicates that SBI offers more transparent information to 
its clients regarding green banking. With regard to staff  
assistance, the scores are near, with SBI scoring 2.9 and 
KGB just slightly higher at 3.02. This suggests that KGB 
clients slightly favor their bank’s staff  performance in 
sustainable banking activities over SBI. While analyzing 
green banking product availability, SBI received a much 
higher score of  4.3 in comparison to KGB’s score of  
3.4. This shows that customers perceive SBI as offering a 

greater or superior range of  green banking products. Over 
all, SBI generally receives higher ratings in most areas 
(comfort, clarity of  information, product availability), 
with the exception of  employee conduct where KGB 
slightly outperforms. Customers tend to be more content 
with SBI’s eco-friendly banking services, specifically with 
the range of  products offered. Hence, null hypothesis (1) 
rejected accordingly.

Relationship between Green Literacy and Green Loyalty
H03: There is Significant Association between Green 
Literacy and Green Loyalty among Banking Customers
To test the relationship between green literacy and green 
loyalty among banking customers, Pearson correlation 
coefficient tool is applied here.

Table 9: Correlations between Green Literacy and Loyalty (Combined form)
Variables Values
  X Values -Green Literacy (A+ SA)* 167 168 166 157 151 182 153
  Y Values -Green Loyalty (A+SA)* 172 166 169 164 164 167 158

*Total of  agreed responses and strongly agreed responses (A+SA)
Out of  200 respondents (100 of  SBI and 100 of  KGB), correlation analysis considered only the respondents who agreed or strongly 
agreed on the statements given in questionnaire of  the study
X Values, ∑ = 1144, Mean = 163.429, ∑(X - Mx)2 = SSx = 689.714, R Calculation, r = ∑((X - My)(Y - Mx)) /√((SSx)(SSy))
Y Values, ∑ = 1160, Mean = 165.714, ∑(Y - My)2 = SSy = 117.429, = 168.857 / √((689.714)(117.429)), = 0.5933
X and Y Combined, N = 7, ∑(X - Mx)(Y - My), = 168.857, Meta Numeric (cross-check), r = 0.5933

Figure 2: Correlations between green literacy and loyalty

Both algebraic and figure confirm that there is a moderate 
positive correlation, which means there is a tendency for 
high X variable scores go with high Y variable scores (and 
vice versa). Hence, there is positive correlation between 
green literacy and green loyalty of  bank customer. The 
value of  R2, the coefficient of  determination, is 0.352. 
The P-Value is < .00001. The result is significant at p < 
.01. So, there is a significant association between green 
banking literacy and green banking loyalty of  both SBI 
and KGB. It is noteworthy that green literacy among 
banking customers will have direct positive impact on 
their loyalty towards banks.  

Discussion
The survey findings and analysis provide crucial 
information about customers’ green literacy perception, 
loyalty, and satisfaction regarding eco-friendly banking 
services. The initial analysis part of  the study examines 
demographic profile, customers green literacy, loyalty, 
perceived benefits, and satisfaction in a combined 
approach (taking 200 samples: 100 SBI customer+100 
KGB customer), the customers’ satisfaction in green 
banking practices is also analyzed in comparative form(by 
taking respondents of  both banks separately). The study 
sample is evenly split between genders, with 56 per cent 



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Am. J. Environ Econ. 4(1) 32-42, 2025

male and 44 per cent female. A majority (54 per cent) 
is aged 18-25, and 30per cent are 26-35. Almost half  
(49 per cent) earn less than ₹25,000 per month, while 
only 12 per cent make over ₹75,000. Most participants 
are employed, with a focus on youth and middle-class 
earners. The survey revealed that participants are well-
informed and confident about green banking practices. 
The table displays their views using a Likert’s scale, 
focusing on green literacy. Most participants show high 
awareness, understanding, and satisfaction with green 
banking information from their banks, which reflect 
relatively high green literacy in Bank customers in Kerala. 
However, some feel unsure about reducing their carbon 
footprint, suggesting a need for education. Participants 
generally agree that they are informed about their 
bank’s eco-friendly efforts and feel confident in utilizing 
green banking services. The findings suggest a need for 
increased awareness of  environmental risks from non-
eco-friendly banking through education and government 
communication. The third section of  analysis part reveals 
customers favour eco-friendly banking services (mean 
4.26). They hesitate to recommend environmentally 
friendly banks, doubt their honesty, yet willing to pay for 
eco-friendly services (mean 4.10). The fourth section of  
data analysis, customer satisfaction data for green banking 
services revealed varying levels of  satisfaction. Customers 
appreciate the availability of  products (average score 3.84), 
but green banking information clarity needs improvement 
(mean score 3.13). Satisfaction levels decrease for staff  
assistance and convenience (averaging 2.97 and 2.87), 
suggesting issues with service conduct and overall 
convenience. Improving customer service interactions is 
essential despite the range of  products available.
The research data indicates strong support for green 
banking practices, with high percentages of  respondents 
agreeing that sustainability initiatives influence their 
recommendations, satisfaction, loyalty, and continued use 
of  the bank’s services. Overall, the bank’s eco-friendly 
actions positively impact customer satisfaction, loyalty, 
and advocacy, with average ratings reflecting high levels 
of  approval for the bank’s commitment to sustainability. 
The independent samples t-test compared customer 
satisfaction with green banking practices between SBI 
and KGB. The test showed a t-statistic of  -2.982 and 
p-value of  0.004, rejecting the null hypothesis at 5% 
significance level. Customer satisfaction levels differed 
significantly between the two banks. SBI had higher 
ratings for convenience, clarity of  information, and green 
banking product availability compared to KGB. However, 
KGB scored slightly higher in staff  assistance. Overall, 
customers were more satisfied with SBI’s eco-friendly 
banking initiatives. The null hypothesis was rejected 
based on the statistical evidence. A moderate positive 
correlation between green banking literacy and loyalty 
among SBI and KGB customers was found, with an R2 
value of  0.352 and a significant p-value of  < .00001. This 
suggests that higher green literacy leads to higher loyalty 
towards banks, highlighting the importance of  educating 
customers on sustainable practices.

Suggestions
Banks should prioritize improving transparency and 
communication regarding their environmental efforts 
to enhance their green banking initiatives and ensure 
that customers are well-informed. Providing rewards 
for adopting environmentally friendly banking practices 
and linking loyalty programs to eco-conscious behaviors 
can further motivate engagement. Frequent surveys to 
assess customer opinions and contentment, paired with 
educational initiatives showcasing the environmental 
consequences of  banking decisions, are crucial. 
Comparing with top competitors in the industry can 
enhance green banking services, and establishing specific 
and quantifiable sustainability targets will keep both 
banks dedicated to their environmental goals. Moreover, 
enhancing staff  training to educate customers about 
the advantages of  green banking and partnering with 
environmental groups for joint projects can improve 
credibility and effectiveness. Banks should improve eco-
friendly services, provide regular updates for green banking 
appeal, and ensure adherence to global environmental 
standards. Promoting employee involvement can cultivate 
a culture of  sustainability. Options include green loan 
schemes, incentives for digital banking, and carbon 
footprint calculators in apps. Partnering with the local 
community and communicating effectively will enhance 
the bank’s green banking strategy.

Implication
This study provides valuable insights into the dynamics 
of  green banking and its impact on customer behaviour 
and loyalty. By examining the environmental literacy 
of  customers of  Kerala Gramin Bank and SBI, and 
comparing customer perception and satisfaction 
towards green banking, the research contributes to the 
broader discourse on sustainable banking practices. The 
findings highlight the importance of  awareness and 
education, trust, perceived benefits, and alignment with 
customer values in fostering customer loyalty. Banks and 
policymakers can leverage these insights to enhance their 
sustainability efforts and promote green banking practices 
across the financial sector. This research represents a 
significant step towards understanding and advancing the 
role of  green banking in sustainable development.

CONCLUSION
The present study is conducted to evaluate and compare 
the green literacy, loyalty, satisfaction and intention of  
customers regarding green banking practices of  SBI and 
KGB. Both Gramin Bank and SBI have demonstrated 
a firm dedication to green banking by implementing 
initiatives such as digital banking services, investments 
in renewable energy, and the offering of  eco-friendly 
financial products. Nevertheless, the research found 
notable disparities in how customers from each bank view 
and appreciate these efforts, with customer satisfaction 
showing statistically different levels between the two 
institutions. This underscores the importance of  custom 
strategies to meet customer needs and improve their 



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Am. J. Environ Econ. 4(1) 32-42, 2025

satisfaction. Clients who trusted in the environmentally 
friendly aspects of  a bank’s products or operations were 
more inclined to stay loyal, stressing the significance of  
transparent communication in highlighting the concrete 
environmental advantages of  green banking efforts. The 
detailed examination of  attitudinal loyalty revealed subtle 
distinctions among customers of  KGB and SBI, with 
satisfaction levels and perceived effectiveness playing a 
role in shaping loyalty actions. By focusing on improving 
service quality and interaction with customers, these 
variations can be addressed to increase overall satisfaction 
and loyalty even more. This research offers practical 
suggestions for banks to enhance their green banking 
efforts and enhance customer intention and loyalty. By 
prioritizing improved communication, addressing gaps in 
satisfaction, and showcasing measurable environmental 
effects, KGB and SBI can establish themselves as the 
forefront of  sustainable banking practices in Kerala. 
Ongoing research and adjusting to customer preferences 
will be essential to stay competitive and relevant in the 
changing environment of  green banking.

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