Is green finance conducted under green banking, green lending by commercial banks truly green, i.e. pro-climate, pro-environment and sustainable?
To what extent does green lending by banks contribute to the development of pro-environmental, pro-climate, sustainable business ventures?
Are commercial banks that advertise themselves as green banks conducting sustainable banking with a portfolio of banking products really green banks?
Do commercial banks that have added sustainability, climate protection and planetary biosphere protection issues to their new development strategy and/or bank mission promoted in the media really provide many green loans that finance real pro-climate, pro-environmental, sustainable economic ventures conducted by borrowers?
Have the credit risk management procedures resulting from green lending been adequately adapted to the ongoing process of global warming, climate and biosphere change and other impacts of this process?
When assessing the creditworthiness of entrepreneurs planning to realise viable pro-climate, pro-environmental, sustainable business ventures, do banks take into account the issue of the risk of climate change and the specific impacts of this process that may affect the green investment planned for implementation?
How do commercial banks advertising themselves as green, sustainable banks improve their lending procedures and green credit risk management process?
What do you think?
What do you think about this topic?
Please reply,
I invite you all to discuss,
Thank you very much,
Regards,
Dariusz Prokopowicz
If the loans are used to finance green projects or projects that have positive environmental benefits, then yes, the loans are really green
These are the baby steps in the right direction. It is very hard to find zero-emission investment opportunities but still, money needs to be invested for returns. Current green funding/lending criteria are not 100% green however it is giving the encouragement to be pro-environment and sustainable.
One of the principles of credit risk is to establish a long relationship with the customer, which means that the bank can know the policy and method of spending the loan by the loan because it has historical information about the borrower.
The bank can also set a condition, which is to follow the progress of the loan and where it was spent by putting forward the idea that there are risks to the borrower in spending the loan. Through this principle, it can follow the progress of the loan and the place of its spending and identify whether it was spent in the direction and location of green projects or what.
My greetings ( Dariusz Prokopowicz )
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