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Adoption of Green Finance in Bhutanese Commercial Banks: Challenges, Opportunities, and Strategies

Author

Listed:
  • Samal, Nigam
  • Wangmo, Kinga
  • Dorji, Kinley
  • Seldon, Lekzang Pema
  • Yoezer, Pema
  • Wangchuk, Chencho

Abstract

This study examines the institutional challenges, emerging opportunities, and strategic solutions related to the adoption of green finance in three Bhutanese commercial banks. Despite Bhutan’s strong environmental policies and the introduction of the Green Finance Roadmap (2020) by the Royal Monetary Authority, the uptake of green finance within commercial banking remains limited. Using a qualitative phenomenological approach, semi-structured interviews were conducted with key banking professionals engaged in green finance operations. Thematic analysis identified four central themes: institutional and regulatory shortcomings, financial and market-based constraints, potential growth areas for green finance, and the need for coordinated strategic support.Major barriers include the absence of binding green finance policies, limited technical expertise, high perceived risks, and insufficient market incentives. However, the study also highlights significant opportunities in sectors such as mini-hydropower, solar energy, electric mobility, and sustainable housing, particularly when supported through blended finance models and international donor partnerships.The study offers practical recommendations, including the development of a national green taxonomy, implementation of concessional financing tools, and targeted capacity-building initiatives. These findings aim to support both academic research and evidence-based policymaking by offering actionable insights into how Bhutanese commercial banks can accelerate the integration of green finance and contribute to national sustainability objectives.

Suggested Citation

  • Samal, Nigam & Wangmo, Kinga & Dorji, Kinley & Seldon, Lekzang Pema & Yoezer, Pema & Wangchuk, Chencho, 2025. "Adoption of Green Finance in Bhutanese Commercial Banks: Challenges, Opportunities, and Strategies," Bhutan Journal of Business and Management, Gedu College of Business Studies, Royal University of Bhutan.
    • Handle: RePEc:eoq:bjbmjr:art67
    DOI: 10.17102/bjbm.v8.4
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    References listed on IDEAS

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    1. Peterson K. Ozili, 2022. "Green finance research around the world: a review of literature," International Journal of Green Economics, Inderscience Enterprises Ltd, vol. 16(1), pages 56-75.
    2. Ozili, Peterson Kitakogelu, 2022. "Green finance research around the world: a review of literature," MPRA Paper 114899, University Library of Munich, Germany.
    3. Hamed Taherdoost, 2022. "How to Conduct an Effective Interview; A Guide to Interview Design in Research Study Authors," Post-Print hal-03741838, HAL.
    Full references (including those not matched with items on IDEAS)

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