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Climate Business

Climate Business > Financial Intermediaries 

In FY 11, a total of $648 million in sustainability and climate change mitigation projects were committed through FI's. Renewable energy projects accounted for $ 512 million and EE projects came to $ 136 million. Trade finance made up  slightly over half of total sustainability and climate business for the year.

Success Stories

 

Financial Intermediaries

 

Climate change affects people in developing countries because they often have limited or unreliable access to key resources. This is why sustainability and climate change adaptation and mitigation products provided by local financial institutions (FI's) are critical for Small and Medium Enterprises (SMEs) that want to grow in an environment characterized by depleting resources. Local FI's have the capacity to channel IFC funding for climate friendly investments to smaller clients such as SMEs and bottom-of-the-pyramid borrowers that IFC cannot reach directly. IFC’s approach combines financing with targeted advisory programs and supports the business growth of FI clients by helping them  expand their portfolios and enter new market segments.

 

Investment products include customized credit lines for energy efficiency upgrades and clean technology investments, as well as  mezzanine finance for smaller renewable energy projects. Advisory interventions include technical capacity building for local FI's to help them identify and develop sustainable energy projects, and awareness raising and pipeline development support to local market players such as energy service companies, equipment vendors, consultants and government regulators.

 

In FY 11, a total of $648 million in sustainability and climate change mitigation projects were committed through FI's. Renewable energy projects accounted for $ 512 million and energy efficiency  projects came to $136 million. Trade finance made up slightly over half of total sustainability and climate business for the year.

 

Commercial Banks

 

Banks play a central role in helping to cut carbon emissions as resource efficiency and renewable energy projects need financing in order to be implemented. IFC supports commercial banks and all relevant partners in providing such funding.

Private Equity Funds

 

IFC started an investment program focused on climate change funds in 2007. Since the inception of this program, IFC has invested $154 million in 8 funds targeting climate friendly businesses in a variety of sectors.

Insurance

 

Products such as micro-insurance, agricultural insurance and index-based weather insurance are increasingly necessary as instruments for safeguarding against specific risks.

Housing Banks

 

Because there is a critical need in many markets to foster the production of affordable and sustainable housing, we are actively pursuing the establishment of housing financing facilities.

Microfinance Institutions 

 

IFC is one of the leading multilateral investors in terms of outreach to microfinance institutions, working with more than 100 institutions in over 60 countries. 

Leasing Institutions 

 

IFC's aim is to make use of leasing to counter the lack of access to capital needed to purchase sustainable energy equipment that would be used for energy efficiency, renewable energy, and cleaner production.

 

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