🧭 From €100B green finance to AI-powered compliance

Hey there! 👋

Last week, we explored Estonia’s leadership in climate fintech, cutting-edge AI compliance tools, and the $789 billion green finance opportunity for SMEs. This week, we spotlight CaixaBank’s ambitious €100 billion green finance pledge, Bolivia’s innovative carbon credit sales strategy, and the transformative impact of EU’s CS3D regulation on risk management.

At the BIG Risk Navigator, we deliver key insights into sustainability, climate finance, and tech innovation—equipping you to build future-proof, resilient businesses.

Let’s dive into this week’s updates.

• CaixaBank commits €100 billion to sustainable finance by 2027: CaixaBank has unveiled its 2025-2027 Sustainability Plan, a cornerstone of its Strategic Plan.

• Bank of England reports major AI growth in the financial sector: The latest research conducted by the Bank of England and the Financial Conduct Authority (FCA) highlights a significant leap in the adoption of AI within the UK Financial Services sector.

• AI-driven insurTech Federato secures $40m Series C funding round: Federato, an InsurTech startup specialising in AI-driven underwriting solutions.

• EU greenlights new ESG regulation to fortify investor trust: The Council of the EU has endorsed a significant regulation aimed at enhancing the transparency, consistency, and comparability of ESG ratings.

• Bolivia targets $5 billion in carbon credit sales to combat deforestation: The plan allows countries and companies to offset emissions by funding projects that reduce climate-warming emissions.

Before getting deep into the news, take a look at how you can engage more in my community.

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🎯 Sustainable banking: From vision to reality

The financial industry is increasingly recognizing the urgent need to align its operations with sustainability goals. While many leading financial institutions (FIs) have unveiled their net-zero roadmaps for 2050, the focus now shifts to actionable steps that can drive immediate impact. As key players in the global economy, banks are well-positioned to lead the charge in green financing and cater to the growing demand for sustainable products.

"Consumer demand is surging, not just for ESG-focused offerings, but for products with clear links to well-defined metrics and impact mandates," says Shuvo G Roy, VP and Head of Banking Solutions (EMEA) at Mphasis. Statistics underscore this trend, with recent research indicating that consumers are willing to allocate up to 40% of their savings to green products. This growing appetite has fueled the rapid rise of green assets under management (AUM), which now approaches 10% of global AUM.

Why it matters for climate fintech: The increasing emphasis on sustainable finance presents a significant opportunity for climate fintech startups. As banks and other financial institutions seek to integrate ESG factors into their operations, innovative fintech solutions can provide the necessary tools and technologies to streamline processes, enhance risk management, and develop new sustainable products. This could lead to increased funding opportunities, partnerships with traditional financial institutions, and the development of groundbreaking solutions that address the climate crisis.

Key implications for startups: To fully capitalize on this opportunity, climate fintech startups should focus on developing solutions that:

• Measure and manage climate risk: Provide tools to assess the climate-related risks faced by financial institutions and their portfolios.

• Facilitate green finance: Develop platforms to connect investors with green projects and facilitate sustainable lending and investment.

• Enable data-driven decision making: Utilize advanced analytics to analyze ESG data and inform investment decisions.

• Promote transparency and accountability: Provide tools to track and report on environmental and social impact.

🎯 Airwallex: Turning 1% Pledge into a fintech foundation

Global fintech leader Airwallex has taken a significant step towards corporate social responsibility by joining the Pledge 1% movement. This initiative will see the company dedicate 1% of its equity to support emerging entrepreneurs and philanthropic causes.

By joining the Pledge 1%, Airwallex joins the ranks of tech giants like Atlassian, Canva, and Airbnb, demonstrating a growing trend of tech companies prioritizing social impact. The company's commitment is further solidified through the establishment of the Airwallex Impact program, an endowment structure designed to grow alongside the company's valuation.

Why it matters for climate fintech: Airwallex's commitment to supporting startups and social causes has significant implications for the climate fintech sector. By nurturing a vibrant startup ecosystem, the company can foster innovation and the development of new solutions to address climate change and sustainability challenges. This could lead to the emergence of fintech companies focused on green finance, sustainable investing, and climate-resilient technologies.

Key implications for startups: 

• Increased funding opportunities: Airwallex's Impact Program can provide increased funding opportunities for startups, particularly those focused on sustainability and social impact.

• Mentorship and networking: The company's commitment to mentoring and networking can provide invaluable support to early-stage startups.

• Access to technology and infrastructure: Airwallex's payment infrastructure and technology can be a valuable asset for startups, especially those operating in cross-border markets.

🎯 How CS3D is reshaping financial institutions’ approach to risk management

The European Union's Corporate Sustainability Due Diligence Directive (CS3D), enacted on July 25, 2024, is poised to revolutionize the financial landscape. This groundbreaking legislation mandates that financial institutions (FIs) within the EU, and those with significant EU operations, adopt a more proactive approach to managing environmental and social risks.

The Directive's far-reaching implications extend beyond traditional financial metrics, compelling FIs to prioritize human rights and environmental impact assessments. This shift underscores the growing importance of sustainable finance and the need for responsible business practices.

Why it matters for climate fintech: AThe CS3D's emphasis on climate change mitigation and transition plans aligns seamlessly with the goals of climate fintech. By requiring FIs to assess the climate impact of their investments and lending activities, the Directive encourages the development of innovative financial products and services that support sustainable development.

Moreover, the Directive's focus on due diligence and transparency can drive the adoption of climate risk assessment tools and data analytics solutions. Climate fintech startups can capitalize on this opportunity by providing cutting-edge solutions to help FIs comply with the new regulations and manage their climate-related risks.

Key implications for startups: The CS3D presents both challenges and opportunities for climate fintech startups. On one hand, the Directive's stringent requirements may increase the regulatory burden on FIs, potentially leading to a surge in demand for specialized services and technologies. Startups that can offer innovative solutions to help FIs navigate the complex regulatory landscape can position themselves for significant growth.

However, the Directive's focus on due diligence and transparency may also increase operational costs and compliance risks for startups. It is crucial for startups to stay informed about the evolving regulatory landscape and to invest in robust compliance frameworks.

By embracing the principles of sustainable finance and leveraging technological advancements, climate fintech startups can play a pivotal role in shaping the future of the financial industry.

🎯 CaixaBank commits €100 billion to sustainable finance by 2027

✅ Key Insights

• CaixaBank’s 2025-2027 Sustainability Plan includes a 56% increase in sustainable financing, targeting €100 billion to drive environmental, social, and economic transformation.

• The bank aims to cut financed emissions in key sectors by up to 100%, advancing toward carbon neutrality by 2050.

• Plans to improve financial inclusion and employability, benefiting 150,000 people through targeted initiatives for vulnerable groups and seniors.

CaixaBank has unveiled its 2025-2027 Sustainability Plan, a cornerstone of its Strategic Plan, committing to mobilize €100 billion in sustainable finance—a 56% increase from its previous plan. This ambitious initiative aligns with its goal to transition to a low-carbon economy and foster social and economic development.

Read more.

🎯AI-driven insurTech Federato secures $40m Series C funding round

✅ Key Insights

• InsurTech startup specialising in AI-driven underwriting solutions.

• The round was led by StepStone Group, with continued support from existing investors Emergence Capital, Caffeinated Capital, and Pear VC.

• The firm plans to use the fresh funding to expand its global footprint.

Federato is known for its innovative underwriting platform that leverages artificial intelligence to streamline processes for insurers, including global carriers, managing general agents (MGAs), and mutuals.

Read more.

🎯 EU greenlights new ESG regulation to fortify investor trust

✅ Key Insights

• This regulatory advance seeks to boost investor confidence in sustainable financial products by ensuring the reliability of ESG evaluations.

• The regulation sets out criteria for non-EU rating providers.

• In the UK, a significant majority (95%) of respondents during consultations supported the regulation.

Under the new regulation, ESG rating providers within the EU will require authorization and be subject to monitoring by the European Securities and Markets Authority (ESMA). These providers must also disclose their rating methodologies and information sources to uphold transparency.

Read more.

🎯 Bolivia targets $5 billion in carbon credit sales to combat deforestation

✅ Key Insights

• Bolivia plans to raise $5 billion through carbon credits to end deforestation by 2030, aligning with global climate targets under the Paris Agreement.

• The initiative seeks to address Bolivia’s economic struggles, depleted reserves, and soaring deforestation rates, with proceeds earmarked for forest conservation and reforestation.

• Talks with corporations and governments are underway, with first deliveries expected by Q2 2025, ensuring compliance through Laconic Infrastructure Partners’ platform.

Bolivia is set to sell $5 billion worth of carbon offset credits to tackle rampant deforestation and achieve its goal of halting forest loss by 2030. The plan allows countries and companies to offset emissions by funding projects that reduce climate-warming emissions.

Read more.

Reimagining urban finance for a climate-resilient future

At last week’s COP29, nations faced an urgent priority – addressing the critical role of finance in adapting to climate change and tackling loss and damage. Cities, which account for over 70% of global CO2 emissions and house more than half the world's population, stand at the frontline of both climate impacts and solutions. Yet with a staggering global climate financing gap of more than US$4 trillion annually, it's clear that new approaches to funding urban climate action are needed.

✅ Highlights 

• Democratizing access to finance through crowdfunding

• Leveraging blockchain technology to foster transparency and efficiency

• Building resilience with innovative financial instruments

UNDP in Europe and Central Asia has been advancing an array of innovative financing initiatives designed to transform our cities and build resilience in the face of climate change. We're testing different approaches – from assessing how blockchain technology can help fund green initiatives, to building capacity for crowdfunding that empowers communities to invest in sustainable efforts, to exploring how environmental impact bonds can create win-win opportunities for investors and the planet.

Read more.

 Climate fintech flourishes under female leadership

✅ Highlights 

• Decoding climate fintech

• Insights from Tenity's 2024 Report

Recent findings from Tenity's 2024 Global Climate Fintech Report illuminate a significant trend: companies with at least one woman founder or CEO secured over half of the funding in pre-Series B rounds during 2022-2023.

This figure stands in stark contrast to the broader fintech landscape, where women-led companies typically receive only 3.4% of venture funding.

What's even more striking is the role of female entrepreneurs in the area of climate fintechs. They have co-founded or led one-third of all these innovative firms. This proportion increased to a remarkable 45% for companies initiated in 2023.

Read more.

🌏 Join my community connecting climate fintech startups with investors.

📰 Share this newsletter with a friend and start to stand out in the executive meetings.

🖇️ Connect with me on LinkedIn for daily insights on expanding into the US market.

🤝 Need a board director? Reach out to me today.