The State of Green Banks 2025

The State of Green Banks 2025 report by the Climate Policy Initiative (CPI) analyzes the global landscape of green banks, focusing on their role in bridging a USD 7.4 trillion annual climate funding gap. Based on survey data from 51 public financial institutions, the report identifies four primary models for green banks—standalone de novo banks, enhanced public development banks (PDBs), green facilities within PDBs, and country platforms—and evaluates their suitability for different economic contexts, particularly in emerging markets and developing economies (EMDEs).

• The report identifies four primary structural models for green banks: standalone de novo banks (independent institutions), enhancing existing PDBs (greening mandates of pre-existing FIs), green facilities within PDBs (dedicated windows or funds), and country platforms (multistakeholder partnerships).
• Standalone green banks are more common in advanced economies, whereas EMDEs more frequently utilize green finance facilities within existing PDBs, which can serve as transitional mechanisms to build capacity for future standalone banks.
• Successful green banks require a balance of three sustainability pillars: financial sustainability (leveraging public funds to catalyze private finance), environmental sustainability (adhering to climate taxonomies and ESG/MRV standards), and political sustainability (alignment with national climate strategies and robust governance).
• Survey data from 2024 indicates a trend toward diversifying financial instruments; while debt remains the primary tool, there is an increased use of credit enhancements (67%), guarantees (44%), and technical assistance (44%) compared to 2020 data.
• Investment patterns are shifting toward a wider range of sectors, with low-emission transport seeing increased mention in 2024. However, forestry, land use, and sustainable agriculture remain significantly underinvested.
• Common barriers to the success of green banks include limited access to low-cost and concessional capital, a lack of robust project pipelines, regulatory constraints, and difficulty in attracting specialized talent.
• The report proposes three options for international support to accelerate green bank development in EMDEs: establishing a new green bank design initiative (accelerator), expanding an existing support platform (such as the FiCS Innovation Lab), or forming a coalition of existing initiatives (building on the Green Bank Network).

APA

Tandon, G., Mitra, D., Khanna, N., First, J., Buchner, B., Sims, D., Elizondo, I., & Granoff, I. (2025). The State of Green Banks 2025. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2025/04/The-State-of-Green-Banks-2025.pdf

Chicago

Tandon, Gauri, Debal Mitra, Neha Khanna, Jonathan First, Barbara Buchner, Douglass Sims, Isabelle Elizondo, and Ilmi Granoff. The State of Green Banks 2025. Climate Policy Initiative, 2025. https://www.climatepolicyinitiative.org/wp-content/uploads/2025/04/The-State-of-Green-Banks-2025.pdf.

Wikipedia

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BibTeX

@techreport{tandon2025state, author = {Tandon, Gauri and Mitra, Debal and Khanna, Neha and First, Jonathan and Buchner, Barbara and Sims, Douglass and Elizondo, Isabelle and Granoff, Ilmi}, title = {{The State of Green Banks 2025}}, institution = {Climate Policy Initiative}, year = {2025}, month = apr, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2025/04/The-State-of-Green-Banks-2025.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }