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HSBC first foreign bank in India to launch 'green deposit'; here's what it means

The green deposit will be available in rupee as a fixed tenure term deposit at a pre-agreed return and will offer similar levels of principal protection as a bank deposit.

Aprajita Sharma September 21, 2020 | Updated 14:31 IST
HSBC first foreign bank in India to launch 'green deposit'; here's what it means
The interest rates would vary depending on fund and liquidity requirements of the bank

HSBC, in line with its global offerings, has launched a green deposit programme in India for its corporate clients, thus offering them an avenue to support eco-friendly projects. The money thus collected will finance green initiatives such as renewable energy, clean transportation, pollution prevention and control, green building, sustainable water and wastewater management, among others.

The green deposit will be available in rupee as a fixed tenure term deposit at a pre-agreed return and will offer similar levels of principal protection as a bank deposit. "The interest rates would vary depending on fund and liquidity requirements of the bank and would be in line with the rates for our regular term deposit product for corporate clients," Hitendra Dave, Head-Global Banking and Markets, HSBC India told Business Today.

The minimum or maximum investment amount will also align with the existing deposit framework for corporate clients. "However, the actual amounts would depend upon the availability of eligible projects and businesses," Dave adds.

HSBC will provide customers with a quarterly report containing portfolio-level information regarding the use of the deposited funds. So, corporates looking for the inclusion of a sustainability agenda into their treasury activities or those with limited opportunities for investment in environmentally beneficial projects may find this product particularly relevant.

"Our Green Deposit proposition is designed to help corporates participate in the sustainability agenda with the safety and assurance of a bank deposit. It is equally suitable for corporates who have either a mature sustainability agenda or are looking to start on this path. This product is aligned with our global commitments towards sustainable financing and will allow clients to participate in the journey towards a low carbon economy," says Dave.

HSBC is the first foreign bank in India to have launched this initiative. The bank is already known for its expertise in green loans across sectors. Recently, it financed a green loan project in the renewables sector for a 250 MW wind power project at Kutch, Gujarat.

Also read: HSBC to cut 35,000 jobs over three years

Also read: HSBC denies Chinese media reports that it 'framed' Huawei

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