Bangladesh Bank has raised lending targets for green and sustainable projects, requiring banks to allocate 40% of their net outstanding loans to these initiatives in the private sector by 2025. This new directive follows banks’ success in meeting previous targets, aimed at supporting the country’s goals of reducing greenhouse gas emissions and achieving the UN’s Sustainable Development Goals (SDGs) by 2030. Of the 40 percent, at least 5 percent must go specifically to green projects. Previously, banks were required to allocate 20 percent of their total loans to eco-friendly ventures, but with sustainable finance now representing over 30 percent of total loan disbursements in early 2024, the central bank sees further potential. Chowdhury Liakat Ali, director of Bangladesh Bank’s Sustainable Finance Department, said the revised target will help Bangladesh progress toward its SDGs and the Nationally Determined Contribution targets, as the country aims to reach net zero carbon emissions by 2050.
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