Financial technology has the potential to support green finance and sustainable development in a number of ways.
Greater access to and lower cost of financial products. Individuals and small businesses can access services or invest in climate mitigation/adaptation activities
Improve access to capital markets – reduce the cost of securities, making it easier for smaller businesses and projects to receive funding that is currently only accessible by larger issuers.
Enhancing transparency and market integrity – distributed ledger (blockchain) and smart contract technology enables the tracking and direct transfer of digital assets without the need for trusted intermediaries, further reducing costs.
FinTech start-ups can experiment with innovative approaches to providing financial services that might be difficult or impossible for larger institutions.
Digital platforms and data analytics enable issuers, fund managers and others to target retail or institutional investors with an appetite for green and sustainable finance investment.
Apps that can track customer spending behaviour can ‘nudge’ consumers towards more climate-positive spending and behaviours