July 23: In recent times, climate change and its effects have become a challenge for sustainable development. All the countries of the world are struggling to reduce the effects of climate change. Recently, there has been a big debate about green financing. Various countries have implemented the concept of green finance, which is considered important for sustainable development. Development banks have decided to come up with two special schemes as its practice is starting in Nepal as well.

Development banks have introduced 'Green Deposit Scheme' and 'Green Loan Scheme' to contribute to sustainable development. Development Bankers Association of Nepal (DBAN) working committee has decided to include investments in about a dozen productive sectors in the green credit scheme, including agricultural enterprises, forestry enterprises, hydroelectricity, solar energy, biological energy, wind energy, cable car/ropeway, electric vehicles and waste water processing enterprises.

DBAN informed New Business Age that since the investment of banks and financial institutions is increasing in relatively less productive areas, it has decided to introduce 'Green Loan Scheme' with the aim of increasing loans in areas that support productive and sustainable development.

Green deposit scheme is also going to be introduced with the aim of gradually securing resources for investment in green loan schemes. In the green deposit scheme, interest will be provided 0.25 percentage point higher than other savings and term deposits. Similarly, in the green loan scheme, the "product paper" of the loan scheme is going to be developed in such a way that the interest rate is 0.25 percent lower than in other loan schemes of the same nature.

The organization said that any industry/business that emits carbon and affects climate change cannot avail green loan facility. It is said that the organization has issued a circular to its member banks to bring the green deposit scheme and green loan scheme in the market after getting the product paper approved by the board of directors of their respective banks.