Climate Finance

Climate financing in Low- and Middle-Income Countries (LMICs)

Climate finance is conventionally described as the flow of financing towards climate change adaptation and mitigation activities. It is central to accelerating climate action and ensuring vital funds reach the communities that need it the most. We have found that while the term “climate finance” is a popular topic globally, it is still evolving as a concept and is often clouded in jargon. This has inadvertently brought confusion to its application – even among those working directly in the sector. This has inadvertently brought confusion to its application – even among those working directly in the sector.

As a result, the GSMA ClimateTech programme has conducted innovative research to explore the role of mobile and digital technology in accelerating climate investment and financing in low- and middle-income countries. This research was made possible with the support of the UK Foreign Commonwealth and Development Office (FCDO).

Digital technology is uniquely placed to accelerate climate finance

Although the use of mobile and digital technology in climate finance is still in its infancy, it is uniquely placed to accelerate climate finance, as:

An intermediary between financial sources and vulnerable communities (for better access to financing through loans and grants via mobile money for adaptative climate efforts)
A medium of establishing transparent and traceable systems
A tool for collecting precise data, which is important in making climate finance decisions, and
An enabler for vulnerable communities to participate in the carbon market

The Report: Digitally Enabled Climate Finance

Image of the front cover of the Digitally Enabled Climate Finance report

The ‘Digitally Enabled Climate Finance’ report offers unique insights into how digital technologies can be leveraged to strengthen the access and delivery of climate finance in low- and middle-income countries. It dissects the various perceptions of climate finance and showcases the possibilities of how different tech solutions – ranging from mobile money and satellite imagery, to the Internet of Things (IoT) and blockchain – can catalyse lending, credit modeling, and the development of bankable climate projects. The report further explores climate finance mechanisms (e.g., National Climate Change Funds, Voluntary Carbon Credit market) or types (e.g., loans, grants, equity, insurance) that are most ready for digital innovation and can deliver socio-economic impact at the local level. It also outlines ideal business models and presents the benefits that initiatives currently, or could eventually, deliver when using digital technology or engaging with organisations such as mobile network operators. Read the report or watch the report launch video below:

Download the report

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Exploring climate finance from a mobile and digital technology lens

Strengthening the climate finance landscape with digital technology and moving the dial in climate financing in low- and middle-Income countries (LMICs).

Contribute to GSMA’s climate finance research

The GSMA ClimateTech team invites practitioners from diverse sectors to take part in the ongoing climate finance research. If this work interests you and your organisation, please do get in touch here.