Ulaanbaatar, Mongolia
Affordable Loans for Greener Houses
$60 million of green loans have been financed
Inhabitants 1.54 million GDP per capita $5,653 Geographic area 4,704 km²
THE CHALLENGE Mongolia’s capital city needs to reduce air and water pollution, and to drive these sustainability measures, three of the country’s commercial banks have collaborated to begin a new green loan program.
A new green loan program has been initiated in Ulaanbaatar to assist citizens with purchasing environment-friendly houses and for energy efficiency improvements. In Mongolia’s capital city, three of the country’s commercial banks have collaborated to begin a new green loan program. The green loans can be used by citizens to cover purchasing of household items such as electric heaters, and building retrofitting materials and water-saving toilets in an effort to reduce air and water pollution. As well as the green loans, residential housing loans are being offered to residents. They can choose among 10 different blueprints of single-house dwellings that meet the criteria of the loans such as size and energy efficiency standards. This pilot loan program will begin with accepting 60 applications and if proven effective, the financing will expand into the ger area, where the main source of Ulaanbaatar’s air pollution comes from. These initiatives are helping Mongolian banks to gradually build their green lending portfolios. As of 2019, over 2,700 green loans equal to over $60 million were financed by member banks of the Mongolian Sustainable Finance Association.
Co-benefits Economic The loans are subsidized by the National Committee for Environmental Pollution Reduction and are offered to citizens at half of the normal interest rate. Environmental The loans have financed initiatives such as renewable energy projects, water conservation, air pollution reduction, and biodiversity protection. Green loans for green homes. The green loans assist citizens with purchasing environment-friendly houses and incorporating energy efficiency improvements (photo by ADB).
CARBON FINANCE AND PARTNERSHIP 31
