Assessing the Association of Factors Influencing Green Banking Practices (2024)

FAQs

What are the factors influencing green banking? ›

Findings/Result: The stakeholder demand, environmental interest, and brand image are affecting green banking practice. Among them, the rand image emerged as the most influential factor. Green banking plays a crucial role for sustainability.

The empirical results revealed that green banking activities exhibit a significantly positive effect on banks' environmental performance and sources of green financing, and that sources of green financing significantly influence banks' environmental performance.

Green banking refers to the promotion of environmentally friendly practices and the reduction of the bank's carbon footprint. It's similar to a traditional bank because it examines all social, environmental, and ecological concerns with the goal of protection and conservation of natural resources and the environment.

The GBGs have three main pillars: Managing Environmental risk in lending, Green Business Facilitation and Own Impact Reduction.

Credit and liquidity risk, management efficiency, the diversification of business, the market concentration and the economic growth have influence on bank profitability.

Adopting necessary steps for Reducing, Reusing and Recycling, in terms of both materials and equipments. Improving understanding and awareness development among the employees on various environmental and social risk related issues and green banking aspects.

Environmental, sustainable or socially responsible banking is an emerging but familiar concept in banking markets around the world. Different from Green Banks that are publicly funded (see above), these environmental, sustainable or socially-responsible banks make loans from customers' deposits.

A green bank also referred to as a clean energy finance corporation, green investment bank, or clean energy finance authority, is a public or quasi-public financial institution that works with the private sector to develop market tools and financing options to promote the use of clean energy technologies, energy ...

Green or environmental banking can have potential drawbacks for businesses and investors. One drawback is the lower rate of return offered by green projects compared to fossil fuel projects, which makes financial institutions more interested in investing in fossil fuels.

How do green banks make money? ›

For example, green banks can source funding from federal, state, or private grants and bonds; or they can capitalize utility ratepayer surcharges. Legislative action by a local or state government can be used to create a new entity or repurpose existing entities in the form of a green bank.

The specialty of the topic concerning banks/the banking sector is that ESG risks can affect the bank directly (e.g. storm damage to bank buildings), but also affect customers (change in sales opportunities, production disruptions, etc.) leading to, for example, higher loan defaults.

Additionally, this research will concentrate on variables such as the environmental interest, stakeholder pressure, policy guideline, economic factor and loan demand. The results show that all predicted factors are significant to the adoption of green banking.

Green Banking is about cultivating a sustainable future where financial success thrives alongside environmental well-being. The ripples of this movement extend far beyond reducing carbon footprints, offering a rich harvest of economic and social benefits.

Factors influencing green technology innovation include R&D investment, external cooperation, environmental regulation, development strategy, market competition, business model, market integration, factor market integration, commodity market integration, urbanization level, foreign direct investment, economic ...

The research focus on related factors such as, demographic characteristics, customer awareness, perceived benefit, perceived risk, perceived security, legal framework and ICT infrastructure , organization factor, perceived usefulness and perceived ease of use.

These factors that influence consumers' green purchase intention can be grouped into three categories: consumer individual characteristics, cognitive factors, and social factors (Zhuang et al., 2021).