New plan by Kenyan banks to unlock Sh7.3tn climate financing

Kenya's banking industry has launched the Banking Industry Sustainable Finance Roadmap to identify bankable projects while addressing high investment risks and unsuitable lending to unlock Sh7.3 trillion in climate financing over five years.

By Steve UMIDHA Last updated Nov 4, 2026

It is a strategic framework to guide financial institutions in scaling sustainable finance, strengthening climate and nature risk management, improving sustainability disclosures, and channelling capital toward investments that support inclusive and sustainable economic growth.

Developed by the Kenya Bankers Association (KBA) through its Centre for Sustainable Finance and Enterprise Development (CSFED) in partnership with the International Finance Corporation (IFC) and WWF-Kenya, the Roadmap provides a practical industry-wide blueprint for embedding sustainability considerations into governance, risk management, lending decisions, reporting and capital allocation across Kenya’s banking sector.

The roadmap comes as Kenya seeks to accelerate sustainable economic growth, strengthen climate resilience, and mobilise private-sector capital for environmental and development priorities.

It is expected to strengthen the sector’s ability to identify and manage climate-related risks, unlock investment opportunities in green and sustainable projects, and help enterprises, particularly MSMEs, participate in the transition to a more resilient and inclusive economy.

Principal Secretary in the Ministry of Environment, Climate Change and Forestry Festus Ngeno said the framework represents an important step in strengthening the financial sector’s contribution to Kenya’s sustainable development and climate ambitions.

He noted that environmental protection must be treated as a core economic priority and that stronger collaboration between government, financial institutions, investors, businesses and development partners will be essential in directing capital towards sustainable investments and supporting the country’s long-term prosperity.

“Environmental protection must be understood not merely as a conservation responsibility, but as an essential part of our economic planning and long-term prosperity,” Eng. Ngeno said, noting that Kenya’s development ambitions cannot be achieved without strengthening collaboration among national and county governments, financial institutions, development finance institutions, investors, businesses and development partners.

KBA Chairman and KCB Group CEO Paul Russo said the roadmap marks a significant step towards moving the industry from sustainability commitments to practical implementation.

“The roadmap offers an opportunity to consolidate the industry’s progress and set a more practical direction for the next phase of our sustainable finance journey.

It is intended to help translate our ambitions into an action plan that can guide financial institutions in directing capital towards green and sustainable projects, managing nature- and climate-related financial risks, and strengthening sustainability practices,” Mr Russo said.

KBA Chief Executive Officer Raimond Molenje said the framework brings together various industry initiatives and provides a clear pathway for accelerating sustainable finance adoption across the banking sector.

“This roadmap offers an opportunity to bring together the various strands of work underway and to provide clearer direction on the practical steps required to scale sustainable finance in Kenya. For financial institutions, this means strengthening the integration of sustainability into governance, risk management, reporting and capital allocation,” Mr. Molenje said.

IFC Regional Director for Eastern Africa Mary Porter Peschka said the initiative represents a key milestone for Kenya’s financial sector and will help mobilise capital towards sustainable development priorities.

“The launch of the Banking Industry Sustainable Finance Roadmap marks an important milestone for Kenya’s financial sector. The roadmap provides a practical framework for strengthening climate and nature risk management, improving sustainability disclosures, and mobilising capital towards investments that support sustainable economic growth. IFC is proud to have partnered with KBA on this journey and we look forward to supporting the next phase of implementation.”

WWF-Kenya Chief Executive Officer Jackson Kiplagat said the Roadmap provides a critical platform for aligning financial flows with environmental sustainability and strengthening resilience against climate and nature-related challenges.

“This roadmap marks an important transition from policy commitments and voluntary sustainability initiatives to measurable institutional action. The focus must now be on implementation, turning commitments into decisions that shape lending, investments, and risk management across the financial sector. WWF-Kenya is proud to support KBA and its member banks in developing Nature Transition Plans that will help drive this shift.

A financially resilient Kenya and a nature-positive nation are not competing ambitions. They are mutually reinforcing foundations of our future prosperity.”

The Banking Industry Sustainable Finance Summit 2026 brought together banking leaders, investors, development partners, regulators and policymakers to discuss emerging priorities in climate-risk governance, sustainability disclosures and the role of finance in supporting Kenya’s environmental and economic objectives.