Bangladesh’s banks and non-bank financial institutions (NBFIs) reported a marked slowdown in green and sustainable finance disbursements during the April–June quarter of 2025, reflecting weaker lending activity in environmentally and socially responsible projects compared with the previous three months.

Latest data from Bangladesh Bank show total green finance disbursement by banks and finance companies fell to Tk 78.49 billion in the April–June period, down 10.43 percent from Tk 87.63 billion in the January–March quarter. Sustainable finance disbursement also declined by 6 percent to Tk 1.41 trillion from Tk 1.50 trillion over the same period.

Out of 61 scheduled banks, 43 had exposure in green finance during the reporting quarter, while 10 of 34 finance companies participated in such lending. Banks accounted for Tk 70.70 billion of the total green finance disbursement, and finance companies contributed Tk 7.78 billion.

The central bank’s Sustainable Finance Policy aims to promote inclusive and environmentally sound growth through financing in areas such as renewable energy, sustainable agriculture, circular economy, and socially responsible business operations.

For 2025, the targets for green and sustainable finance have been set at Tk 678.21 billion and Tk 5.43 trillion respectively—equivalent to 5 percent and 40 percent of banks’ and NBFIs’ net loans and advances outstanding at the end of 2024.

Analysts suggest that meeting these targets will require stronger policy coordination and enhanced access to concessional funding.