The Reserve Bank of India (RBI) Governor Shaktikanta Das on August 28 said that green bonds and deposits face challenges despite benefits.
The governor said challenges include scalability, as the market for green bonds needs to expand significantly to attract larger issuances and diverse set of investors.
Ensuring authenticity and impact of green projects, financed through these frameworks, requires robust monitoring and reporting mechanisms, Das said while addressing the Global Fintech Fest 2024.
He further added that technology can play a pivotal role in overcoming these challenges. The RBI has taken steps for ensuring sustainability with recent initiatives of the Reserve Bank like Sovereign Green Bonds framework of India (2022) and the Framework for acceptance of Green Deposits (2023), Das said.
These frameworks are expected to play an important role in financing green projects, incentivising sustainable practices and lowering societal costs of development, Das said.
On the central bank digital currencies (CBDC) front, Das said the central bank are now utilising features like programmability to provide credit or government assistance to landless tenant farmers and carbon credits to farmers through CBDC.
“While we have successfully demonstrated the interoperability of CBDC with retail fast payment systems like UPI, we continue to gain from our experimentation on off-line solutions,” Das said. He added that as the central bank will make progress, it would be happy to co-operate with other nations in their CBDC efforts.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
