An ethical finance hub based in Scotland will counteract the worst excesses of the financial services industry.

Europe’s first ethical finance hub is set to be opened in Scotland.

A meeting between finance secretary John Swinney, third sector groups and banks agreed in principle to the hub which would act both as a research centre for establishing new financial products and initiatives and for business incubation.

We will work with industry and other partners to investigate the options for establishing such a hub - John Swinney

The Islamic Finance Council (IFC) has been pushing for the centre as a way of offer more ethical options for customers and has been backed by a number of influential organisations including the Church of Scotland, Triodos Bank and law firm Tods Murray.

Omar Shaikh, a board member at the IFC, said following the financial crisis many people are looking for a more socially responsible and stable form of banking and finance.

“We believe the hub can play a critical role in developing such an environment in Scotland and we are pleased to get to this stage,” he said.

“The clear aim of the establishment of a hub is there and we look forward to working with the Scottish Government to ensure this happens.”

Triodos Bank relationship manager in Scotland Graeme Galloway said the opening of the hub will demonstrate Scotland is serious about a sustainable and socially useful financial system.

“Scotland has a great opportunity to place itself as a centre for excellence for sustainable banking, and reap the rewards from it, environmentally, socially and financially,” he said.

The next meeting of the group will agree a deadline for the creation of the hub and a location.

Swinney said: “We will now work with industry and other partners to investigate the options for establishing such a hub.”