Green Loans
Use-of-proceeds financing for eligible green projects.
Green Loans finance ring-fenced, eligible green projects and are structured around the four components of the Green Loan Principles: use of proceeds, project evaluation and selection, management of proceeds, and reporting.
Loans structured around four core components: use of proceeds, process for project evaluation and selection, management of proceeds, and reporting.
Key concepts
Loan funds must be exclusively applied to eligible green projects and clearly documented in facility agreements.
A transparent process for identifying environmental objectives, eligibility criteria and DNSH assessment.
Segregated tracking of drawn and un-drawn funds against the eligible project pool.
Annual allocation and impact reporting covering the environmental outcomes achieved.
Featured articles
Sustainability-Linked Loan vs Green Loan: which one do you need?
SLLs and Green Loans are both core sustainable lending products but solve different problems. A side-by-side comparison covering use of proceeds, KPIs, pricing, reporting and when each fits.
The Green Loan Principles: a practical guide to the GLP
The Green Loan Principles are the market standard for green lending. A structured guide to the four core components, eligible project categories and how to align a facility.
Glossary terms
Frequently asked questions
What qualifies as an eligible Green Project?+
Categories defined by the GLP include renewable energy, energy efficiency, clean transportation, sustainable water management, green buildings and pollution prevention, among others.
Is a Second Party Opinion required?+
Not mandatory, but strongly recommended. Most banks require an external review to confirm alignment with the Green Loan Principles before disbursement.
Related regulations
- GLPGreen Loan Principles
Voluntary market standard published by LMA, APLMA and LSTA.
- EU TaxonomyEU Taxonomy Regulation
Provides technical screening criteria and DNSH tests used to assess project eligibility.
Industry-specific guidance
Process heat, purchased electricity and upstream materials dominate manufacturers' footprints — and the sustainable-finance opportunity is proportionally large.
Embodied carbon in materials, on-site fuel use and the in-use energy performance of buildings converge to make construction one of the largest single levers in the transition.
Transport and logistics operators sit at the intersection of Scope 1 fuel use and their customers' Scope 3 category 4 emissions — making them a priority for both green loans and SLLs.
For banks and investors, sustainability is a system-level challenge — measured, priced and disclosed across the entire balance sheet.
Related platform capabilities
Comparisons
Recommended next reading
See how the Redigo Carbon platform turns green loans into an operating system.
- Green Loan Principles (LMA) — LMA / LSTA / APLMA
- EU Taxonomy Regulation (2020/852) — EU / European Commission
This page follows Redigo Carbon's editorial standards: factual claims reference recognised frameworks; Redigo opinions are labelled as such.