IDBI Bank takes the lead in green banking in India

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IDBI Bank is leading the pack when it comes to environmental banking in India and has been active in this field for over 20 years now.  As part of its pioneering role, the Bank has taken initiatives for funding all potential Clean Development Mechanism (CDM) projects based on clean technologies like renewables, solar cell/module projects, co-generation, energy efficiency equipments projects, etc.  To further enhance involvement in this field, the Bank has created an exclusive group working on climate change and. more specifically, on carbon credits advisory services to clients to deal with CDM/carbon credits of the Kyoto Protocol and Voluntary Emission Reductions (VERs) authorities.  This group has devised a structured product for providing upfront finance against the carbon credit receivables. It provides assistance to the eligible CDM projects against future carbon credit receivables for meeting working capital and capital expenditures during the interim period till carbon credits are generated, received from the United Nations Framework Convention on Climate Change (UNFCCC) and delivered to the buyers.  The product has helped CDM projects ensuring cash flow for long term sustainability of their business besides assisting them to procure clean technology and reduce green house gases (GHG).  This product has been well accepted by the Indian project developers.  IDBI Bank has been one of the few public sector banks/FIs signatories to the Carbon Disclosure Project (CDP) as part of its initiative to promote responsible business by striving towards a low-carbon future.  In addition, the Bank has been taking various initiatives for the reduction of its carbon foot prints which includes the introduction of energy saving lighting, installation of solar water heaters, encouraging steps towards creating awareness for water and energy conservation, and circulation of annual report online to its stakeholders. IDBI Bank’s project on “Initiative for Low-carbon Business Sustainability through Environmental Banking” won ADFIAP’s Outstanding Development Project Award 2014 under the Environmental Development Category.

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