The quest for developing sustainable energy devices has put microbial fuel cells (MFCs) at the forefront of research in recent years. However, the use of synthetic polymer electrolyte membranes (PEMs) such as Nafion is a compromise in the sustainability of this technology. A novel eco-friendly composite PEM has been developed using poly(vinyl alcohol) (PVA) and k-carrageenan (kC) as membrane precursors. Cation exchangers such as vermiculite and imidazole-grafted vermiculite were augmented to the base membrane PVA-kC for developing PEM, called VPC and IPC, respectively. The proton mass transfer of VPC and IPC increased by 57 and 38%, while their oxygen mass transfer decreased by 45 and 44%, respectively, with respect to PVA-kC. Double-chambered MFCs were deployed with the developed PEMs, namely, PVA-kC (PMFC), VPC (VMFC), IPC (IMFC), and commercial Nafion (NMFC), for synthetic wastewater treatment in the aerated cathode configuration and dye decolorization with a ferricyanide cathode. The highest power density of 182 mW•m −3 was obtained with VMFC, followed by IMFC (164 mW•m −3 ), NMFC (145 mW•m −3 ), and PMFC (128 mW•m −3 ), in the aerated cathode MFC. The decolorization percentage increased in the order of PMFC (49%) < NMFC (55%) < IMFC (58%) < VMFC (65%). The cation-exchanger-augmented PVA-kC membrane can be used as a suitable alternative to Nafion in MFCs.