7/29/2019 Green Banking Explanation

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Introduction

Green banking is like a normal bank, which considers all the social and environmentalfactors.

Green banking as a term covers several different areas, but in general refers to howenvironmentally friendly your bank is, and how committed to green and ethical policiesthey are.

It aims to protect the environment and it is controlled by same authorities as what atraditional bank do.

Difference between green banking and a normal bank

The above given are the main differences between a green bank and a regular bank. There are also

several differences.

The Role of Green Banking in India

Indias is the worlds sixth largest and second fastest growing country in terms ofproducing green house gases.

Delhi, Mumbai and Chennai are the three of the worlds ten most polluted cities. The banking operation and investment by financial institutions should take care of

environmental management of these polluting industries.

Aims of green banking

Preserve and effectively use natural resources.

Reduce and recycle waste at source.

Offer environmental-friendly products.

Increase resource savings and energy efficiency.

Increase the environment awareness of its employees, suppliers and customers.

7/29/2019 Green Banking Explanation

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Benefits of Green Banking

It avoids as much as paper work, you get go green credit cards, go green mortgages andalso all the transactions done through online.

They follow environmental standards for lending, which is really a good idea and it willmake business owners to change their business to environmental friendly which is good

for our future generations. When you are awarded with a loan, the interest of that loan is comparatively less with

normal banks, because ethical banks give more importance to environmental friendly

factors they do not operate with high interest.

Green banking in State Bank of India

State Bank of India has adopted a Green Banking Policy with an objective of contributingtowards the fight against the adverse climate change.

One of the initiatives approved by the Board for this purpose is incentivizing customerswho go in for Green Projects.

At present State Bank of India the only Bank in the country supporting the cause of GreenBuildings by offering a 5% concession in margin, 0.25% concession in interest rate.

Small scale sector in India

SSI constitute major portion of Indian industry. Small scale industries emit pollutants to the environment which are dangerous for the

surroundings. These industries on account of their financial constraints are unable to install the

necessary equipment to meet the emission standards prescribed by the competent

authorities.Steps of Green banks to control pollution of SSI

environmental pollution status of SSI. environmental Clearance from the appropriate authorities. steps undertaken or proposed for disposal of solid, liquid and gaseous wastes.

Conclusion

Green Banking if implemented sincerely will be effective for thepolluting industries thatgive a pass by to the other institutional regulatory mechanisms.

It is time now that India takes some major steps to gradually adhere to the equatorprinciples-guidelines that use environment-sensitive parameters, apart from financial, to

fund projects.