The Role of Technology in Promoting Green Finance: A Systematic Literature Survey and the Development of a Framework

Green finance, defined as channeling money into sustainable development activities, is still far lower than needed to achieve net-zero emissions objectives. In this paper, we discuss the role of technologies in developing green finance. We identify that green finance faces three major challenges, including the risk management of green projects, the scarcity of innovative green financing products, and compliance with the regulations. Then, in the context of the existing literature, we explore recent technologies, including blockchain, artificial intelligence (AI), machine learning (ML), data analytics, Internet of Things (IoT), and robotics that are helping to deal with the challenges in green finance. We show that data-driven approaches utilizing AI and ML help in the risk assessment of green projects; FinTech-based crowdfunding platforms provide innovative green financial products and regulatory technologies (RegTech) support in compliance with regulations. We also identify that the environmental footprint of cryptocurrencies is an emerging area in the technologies and green finance domain. Our framework could be helpful to further extend the debate on the role of technology in green finance.