The 3rd Industrial Revolution began in 2006 and witnessed the integration of the latest technology in banking and finance and the rise of Fintechs. It also saw the amalgamation of various environmental care initiatives and techniques to generate an industry compatible with the sustainable development of the environment – giving rise to Cleantech
Products designed with Cleantech are aimed at reducing environmental waste and energy consumption. Cleantech deals with industrial sectors and aids in providing clean, sustainable energy, and the environment by and large.
The objectives of Cleantech are:
- Reduction of industrial pollution
- Technological, environmental renewal
- Industrial globalisation-sustainable development
- Reinsertion of production-ecological basis
Today, many countries have set high goals on the Cleantech front. Countries like India and China, with pollution problems on the rise, have been investing and paying a lot of attention to the Cleantech sector. For instance, solar power has been made cheaper than coal in India, making it a major save on the exhaustive natural resources.
Role of Fintech in Cleantech
Digital payment solutions and blockchain technologies offered by Fintechs have enabled disintermediation in banks as well as companies. The gamut of financial technology now covers e-commerce, equity crowdfunding, crowd-lending, and aggregation platforms. It also envelopes international money transfer, internet-based services in the insurance industry, robo-advisory, and even gamification in the investment space.
Financial innovation is pivotal for Cleantech companies and can contribute towards a sustainable economy through data-driven business models.
How Fintech Impacts Cleantech Investment Strategies
With time, numerous Cleantech clusters are collaborating with investment managers of early-stage companies. They are also integrating with Fintech hubs looking for a chance to scale the financing across supply chains.
Since the launch of the Global Cleantech Cluster Association, financial innovation has been of strategic focus in the Cleantech sector. The body aims for the development of a new, scalable financial mechanism to allow pension fund investments in Cleantech companies citing appropriate risk and return expectations.
Rising Investments in Cleantech
Investors worldwide are feeling the threat of business disruptions due to climate change, impacting social aspects, environmental aspects, and regulatory issues. A vital element of the business world is the realisation that investing in Cleantech is the way forward.
Why Fintech Must Meet Cleantech
When you talk of investments at that scale, you cannot ignore the role Fintech has to play to aid the process. Cleantech innovators need financial backing for R&D.
Fintech has wholly revolutionised the financial sector, providing more natural ways to access funding.
With their technological advancements, Fintechs are slowly but steadily pulling down the financial barriers. Especially for small businesses, Fintech has made the funding process faster and easier. And these small players are the key to innovation. Remember how Apple and Amazon were born?
Also, it’s worth mentioning that Cleantech requires data to operate, and it is one area where Fintechs can help. Big data, for example, allows startups to sort through the massive amounts of information and find interesting patterns they need to use that data correctly. Getting timely investments is critical for businesses and needs quicker decision making, processing volumes of data, evaluating the risks, etc. by the investor or the lending company to be sure that there are no chances of NPAs. Gathering all of this takes time, but thanks to Fintechs, this may not be a big problem anymore. For instance, an excellent loan management system like Finezza facilitates the exchange of information across the different stages of lending and healthily incorporates analytics into the Fintech’s decision-making process.
Thus, Cleantech and Fintech are two sectors that illustrate the life-changing power of technology, and they must come together for a better, smarter, and safer Earth.
Cleantech from the Economic Perspective: Today & Tomorrow
The rise of Cleantech is vital to tackle environmental issues such as climate change. Cleantech has already become a booming business. With the signing of the Paris Agreement and the advent of ecological consciousness across the world, Cleantech has grown to be a potent industry sector.
The Global Renewable Energy Market is expected to rise from $928 billion to an estimated $1512.3 Billion by 2025. More and more industries are investing in Cleantech to improve their bottom line or cut down their operating costs. Cleantech also sufficiently increases the payback period of the company. Furthermore, it shows businesses in a positive light, showcasing them as environmentally responsible-for both the end customers and investors.
To Sum Up
Cleantech covers a vast array of industries like the energy & power sector, mobility & transport sector, food, and agriculture sector, advanced material sector, biofuel and biomass sector, water, and waste & recycling sector. Coming together of the refined internet of things and environmental concerns will yield a promising result. Partnering with Fintech, we can expect Cleantech to come-of-age and leave a solid imprint on the market and the world.
Their innovations are giving us hope and are really something worth looking forward to.
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