What is the definition of green finance? What are the classifications?

Green finance means that the financial sector regards environmental protection as a basic policy, considers the potential environmental impact in investment and financing decisions, integrates the potential benefits, risks and costs related to environmental conditions into the daily business of finance, pays attention to the protection of ecological environment and the control of environmental pollution in financial business activities, and promotes the sustainable development of society through the guidance of social and economic resources.

There are many kinds of green finance, including green credit, green bonds, green investment funds, ESG investment, green insurance, green securities funds, carbon funds and carbon assets. For example, banks and other financial institutions increase financing for green industries, and government departments provide financial convenience for green environmental protection industries when formulating policies. All belong to traditional green finance; Green insurance, green securities fund, carbon fund and carbon assets are all relatively innovative green financial methods.

1. Theoretically, the so-called "green finance" means that the financial sector takes environmental protection as a basic policy, considers the potential environmental impact in investment and financing decisions, integrates the potential benefits, risks and costs related to environmental conditions into daily business, pays attention to the protection of ecological environment and the control of environmental pollution in financial business activities, and promotes the sustainable development of society by guiding social and economic resources.

2. Green finance means that financial institutions incorporate environmental assessment into their processes and pay attention to ecological environment protection and green industry development in investment and financing activities. With population growth, rapid economic development and substantial increase in energy consumption, the global ecological environment has been seriously challenged, and achieving green growth has become the development trend of the world economy. Under the background of the continuous development of low-carbon economy in various countries, green finance has become one of the focuses of attention in the world.

3. China has entered a critical period of economic restructuring and development mode transformation. The development of green industry and the green transformation of traditional industries have increasingly strong demand for finance, which makes "green finance" a new trend and trend in the development of financial institutions, especially the banking industry. Objectively speaking, although China's financial institutions are generally enthusiastic about developing "green finance", they are faced with many obstacles in practice, such as high risk and low income, imperfect information communication mechanism, insufficient technical recognition ability in professional fields, and imperfect relevant policies. However, the author believes that to solve these bottlenecks, we can learn from the successful experience of developed countries, especially Germany. Germany is one of the main cradles of international "green finance". After decades of development, its related policies have been relatively mature and its system is relatively perfect. Analysis shows that Germany's experience in implementing "green finance" mainly includes:

4. First, national participation. This is the most important feature in the process of developing "green finance" in Germany. For example, Germany has issued a policy to give certain loan interest subsidies to environmental protection and energy-saving projects. For projects with good environmental protection and energy saving performance, preferential credit policies can be given within 10 annual loan interest rate 1%, and the spread will be subsidized by the central government. Practice has proved that the state's practice of supporting environmental protection and energy-saving projects with interest subsidies has achieved good results. The state has mobilized a large number of environmental protection and energy-saving projects with less funds, and the "leverage effect" is very obvious.

5. Second, give play to the role of policy banks. Germany's Fuxing Credit Bank has been playing an important role in the whole "green finance" system, constantly developing "green finance" products. In addition, it is worth mentioning that Fuxing Bank's energy-saving and environmental-friendly wealth management products have no government intervention from initial financing to later sales of wealth management products, and all activities are carried out through open and transparent bidding, ensuring the fairness and transparency of the process. The main role of the government is to provide interest subsidies and formulate relevant management measures to ensure the efficient and fair use of funds.

6. Finally, the approval of the environmental protection department. This is the key to the success of developing "green finance" in Germany. In the process of implementing the "green finance" policy in Germany, the environmental protection department played an important role in the audit to ensure that the discount policy can accurately support energy-saving and environmental protection projects. In order to get a discount loan, each energy-saving and environmental protection project must be approved by the local or higher-level environmental protection department before applying.