Snapshot of the world: UN Framework Convention on Climate change and Greenhouse emissions

As noted with the UN Framework Convention on Climate Change (UNFCCC), the adoptive decisions acknowledging climate change at all levels — global, national, and municipal, as well as by the business community — are primarily influenced by diverse economic interests and long-term decisions in conflict with the current, short-term economic interests among various groups and sizes of the population.

On April 7, 2020: the highest reduction in greenhouse gas emissions was observed, which fell by 17% year-on-year, on that day.

Snapshot of the world: Land use planning framework

Although the threat of global climate change has led to biodiversity conservation, the climate adaptation and mitigation requirements have been very limited and are underused and undervalued due to land-use planning frameworks to suit human settlements and profitability solutions.

Acknowledgement of land-use planning as an important arena for biodiversity and climate resilience is to be strengthened among relevant actors at various levels.

Objectives for Green Fintech

l In November 2021, Fintech COP26 objectives and need for Environmental sustainability were discussed for convergence of Finance, Sustainability and Technology.

l Objectives and measures were discussed to combat climate change and control the excessive temperature changes, possibly monitor a 1.5°C temperature increase.

l Developed countries must mobilise at least $100bn in climate finance pa by 2020 and finalise the Paris Rulebook.

l International financial institutions must unleash the trillions in private and public sector finance to secure global net-zero carbon.

l FIs must gear up to tackle the climate crisis through collaboration between governments, businesses and civil society, with a need to phase-out out coal, curtail deforestation, speed up the switch to electric vehicles, encourage investment in renewables.

Digital Financing of Sustainable Development Goals

Digital finance or Fintech can be developed to leverage the scope of sustainable finance, by facilitating sustainability-related data for financial decision-making and access to funding with supporting business models.

Digital finance can unleash the scalability of sustainable finance, with an increase in local community power and providing symmetrical collaboration and data amongst investors and other stakeholders.

Two Roles of Fintech in Financial Services

l Innovation to traditional financial institutions: Fintech companies rely on algorithms or machine-based logic to replicate the back-office processes of traditional financial institutions and generate new technology-based business models.

l Provision of services where no availability of traditional financial infrastructure.

The Future of FinTech

Blockchain innovation is a key area of growth and investment as the implication of the technology when used effectively, are significant. Greenwashing, the misrepresentation of a company through their products’ environmental credentials, is a prevailing concern.

What is Blockchain (DLT’s)?

l Blockchain, the best-known DLT technology, uses a specific structure composed of a chain of data blocks.

l Blockchain is based on a peer-to-peer (P2P) architecture with broadcast capabilities, where transactions are simultaneously recorded in multiple locations.

l Blockchain allows computers to exchange information directly without going through a central server or an authorized institution.

The Role of Fintech in Unlocking Green Finance: blockchain use-cases in Developed and Developing Countries

Europe has been a leader in blockchain technology.

Focus on sustainable development and renewable energy.

Developing economies in Asia have preliminary recommendations in policy-making for harnessing blockchain in fintech for low-carbon, climate-resilient investment and the achievement of the Sustainable Development Goals (SDGs).

Example: UN Pathfinder Initiative with the government of Bangladesh to mobilise domestic savings for sustainable infrastructure investment.

Here, Blockchain technology improves the accountability of the funds and returns the dividends from infrastructure investment to Bangladeshi citizens. This initiative helps to convert micro savers into micro investors and reduce international debt.

Summary of Blockchain in Green Fintech Finance

While a digital crowdfunding platform is used to raise finance, the blockchain can transparently record and certify the use of proceeds, sustainability impact and revenue streams of the project.