The Role of Fintech in Unlocking Green Finance

Abstract

Achieving the Sustainable Development Goals (SDGs) and implementing the Paris Agreement will require significant new investment. New financial technologies (“fintech”) offer the potential to unlock green finance technologies, such as blockchain, the Internet of Things and big data, developed over the same time frame as the Paris Agreement and the SDGs. We outline three broad areas for the possible application of fintech to green finance: blockchain applications for sustainable development; blockchain use-cases for renewable energy, decentralized electricity market, carbon credits, and climate finance; and innovation in financial instruments, including green bonds. We focus on blockchain use-cases pertaining to sustainable development and renewable energy and highlight examples from Europe, which has been a leader in blockchain technology. We also explore the implications for developing economies in Asia and draw preliminary recommendations for policy makers interested in harnessing fintech and blockchain for low-carbon climate-resilient investment and the achievement of the SDGs.