The European Bank for Reconstruction and Development (EBRD) and the Green Climate Fund (GCF) are encouraging more households and businesses in Mongolia to invest in green and innovative measures that promote the efficient use of water, sustainable land management and greater resource efficiency by launching the next phase of GEFF, Greening Financial Systems (GFS) framework in the country’s capital Ulaanbaatar.

Although officially announced today, the GFS has already started operating in Mongolia. Earlier this year, the EBRD approved a loan of US$ 80 million (€ 69 million) to Khan Bank under the framework, as part of a wider US$ 170 million (€ 146 million) financing package. Other financial institutions are expected to join the GFS soon.

The new framework will move beyond traditional project-based green lending. It will help Mongolian financial institutions to make climate-related considerations an integral part of their strategy, governance and risk management – making green finance part of mainstream banking rather than a separate line of business.

It builds on the EBRD and GCF Green Economy Financing Facility (GEFF), established in 2018 and has since expanded into a US$225 million financing framework. The GEFF has so far supported more than 330 subprojects across various sectors of the Mongolian economy, giving access to greener technologies ranging from energy-efficient buildings to renewables and resource-efficient equipment. It helped to deliver annual energy savings of around 2 million gigajoules and reduced annual carbon emissions by almost 150,000 tonnes.

Mongolia is known for its extreme weather conditions and vulnerability to the negative impacts of climate change. Its energy system remains carbon-intensive, and needs substantial investment in energy efficiency, renewable energy, resilient infrastructure and the sustainable use of natural resources. The GFS will help to address these issues by combining affordable climate finance with institutional capacity building.

The new global US$ 620 million (€ 533 million) initiative combines EBRD loans and GCF concessional financing for lenders across 13 countries from the southern and eastern Mediterranean to Mongolia. It is supported by grants worth US$ 49 million (€ 42 million). The GFS will be aiming to channel at least 20 per cent of available funds to support women-led businesses, and around 30 per cent to target businesses in rural areas. This component will be supported by the government of Canada under the High-Impact Partnership on Climate Action (HIPCA)*.

Over the past two decades, the EBRD has financed 172 projects worth a total of US$ 3.2 billion (€2.8 billion) in various sectors of the Bank’s most easterly investee economy. Ninety per cent of the Bank’s loans in the country have been extended to private companies, making the EBRD the largest lender to Mongolia’s private sector among the international financial institutions.

* Active HIPCA donors include: Austria, Canada, Finland, Germany, the Netherlands, Norway, the Republic of Korea, Spain, Switzerland, TaiwanICDF, the United Kingdom and the United States of America.

Published Date:2026-09-16