Financial Institutions (FIs), the key constituent for the development of a country, can improve their service level along with enhanced social responsibility through the practice of ‘green financing’. Initiatives have been taken to practice green financing throughout the economy covering banks and other non-bank financial institutions in Bangladesh. This qualitative study aims to bring out the challenges & opportunities for green banking in Bangladesh based on an examination of published information such as research papers, sustainability reports from different banks and environmental organisations, published documents of the Bangladesh bank and consultation with bankers. In addition to the portrayal of current green banking practices in Bangladesh, this paper establishes the major challenges such as the incorporation of environmental parameters, effective policy formulation, the creation of homogenous environments and other aspects. The findings of this study show opportunities to improve green banking practice such as the improvement of online financing/banking, separate green financing/banking unit, incorporation of environmental risk with the core risks and other views of policy formulation.
Keywords: green financing, green banking, banking sector, environment, social responsibility, financial sector, sustainable institutions