If SMEs are to adopt more sustainable practices, institutional support—financial and expertise to navigate the climate finance market—will be essential Absence of sustainable practices The 3I framework—Instruments, Institutions and Initiatives— can serve as a compass for SMEs to effectively capitalise on climate finance. For SMEs, accessing loans, bonds and equity investments, or climate finance, is key to cutting costs and staying competitive in transitioning global supply chains. Crafting Resilience India’s shift to a low-carbon economy is driven by institutions supporting SME sustainability efforts. Public and private sector banks and non-banking financial companies (NBFCs), provide long-term credit plus financial guidance. The government-run department of industries and district industries centres promote sustainable industrial development and infrastructure for SMEs. Nationally, the Small Industries Development Bank of India (Sidbi) provides affordable energy efficiency and green finance schemes, while the Bureau of Energy Efficiency promotes energy-efficient technologies. The National Bank for Agriculture and Rural Development (Nabard) supports rural SMEs with financial and policy-driven interventions for sustainable agriculture and business practices. Supporting green efforts Support Systems for SMEs The MSE Green Investment and Financing for Transformation (MSE Gift) Scheme helps SMEs adopt green technology through interest subvention and credit guarantees, benefiting around 12,000 MSEs and leading to energy and cost savings. The MSE Scheme for Promotion and Investment in Circular Economy (MSE-SPICE) supports SMEs in adopting circular economy practices, particularly in waste management sectors. The Climate Change Fund (CCF), managed by Nabard, is a major climate finance mechanism, funding mitigation and adaptation projects while fostering climate resilience and awareness. The Policy for Financing Transmission Projects ensures financial assistance for integrating renewable energy into the power grid. The Loan Against Securitisation of Future Cash Flow of Renewable Energy Projects helps developers secure funding by leveraging future revenues, improving liquidity and accelerating renewable energy deployment. The Special […]
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