Responsible Banking

Ongoing engagements in Sustainable Finance:

As a step towards inclusive and sustainable growth, the Bank has established a dedicated line of credit for financing –

• Climate smart loans

• Sustainable agricultural loans

• Strong micro banking portfolio aimed at hitherto unbanked women

• Financial literacy activities to empower women with financial knowledge on savings and financial products

• Funding Sustainable Agricultural Practices and Businesses

The Bank is active in disbursal of loans from climate smart credit lines and in sectors like renewable energy, electric vehicles and agriculture, which results in emission reductions and delinking the economic growth from GHG emissions.

As a part of a larger climate risk agenda and green lending initiatives, the Bank has also made its foray into sustainable agricultural loans aimed at climate-friendly agricultural practices that optimize water usage and energy efficiency.

The Bureau of Energy Efficiency (BEE), Government of India has set up a Facilitation Centre (FC) for promotion of BEE financing schemes. RBL Bank has already joined this initiative as a financial institution. This will give the Bank access to potential borrowers, who require loans to pre-screened energy efficiency projects.

Financial Inclusion and Financial Literacy:

The Bank’s Credit Policy for Financial Inclusion (FI) Business guides the Financial Inclusion efforts. FI activities are aimed towards improving the quality of life of lower income groups in India’s rural and semi-rural areas by honing their entrepreneurial skills. The Bank’s financial inclusion efforts are also supported by financial literacy (FL) training of clients. This, in the long run, helps borrowers to access mainstream finance and improve income levels.

Various financial inclusion products (like microfinance, micro-banking & no-frills accounts, micro-enterprise financing, micro-savings and remittances, crop, life and accident insurance products etc.) have been rolled out by the Bank for underprivileged, under-banked and unbanked sections of the society. The Bank also operates micro- ATMs for these segments of customers.

The Bank has received multiple awards for its innovative practices, digital initiatives with a special focus on building a sustainable solution aimed at addressing unmet needs of the customer segments and community.

It has received Outstanding Performance in POS deployment in Northeast Award at the Digital Payments Awards by the Ministry of Electronics and Information Technology (MeitY), Government of India, which is unique by virtue of significant digital divide between North-east India and rest of the country.

The Bank, in association with multilateral development institutions and several non-government organizations (NGOs), has been engaged in conducting Financial Literacy training programmes in several States across India. The target audience for these programmes are the marginalized- and economically weaker sections of society, especially women in small self-help/ joint liability groups. These programmes are designed to meet following objectives:

• Introduce them to basic financial products like savings account, loan account, term deposits and insurance

• Explain concepts of financial discipline to help manage their money in a responsible manner

• Improve their access to credit through formal channels to avoid exploitation by money-lenders

• Educate with respect to usage of banking services through alternate channels like mobile ATMs or SMS

Independent impact assessment studies have shown that the Bank’s financial inclusion & financial literacy activities have had positive impact on the livelihood and financial choices of targeted communities, leading to their financial security and financial independence.

Managing climate change impacts

Climate Risk & Task Force for Climate related Financial Disclosure (TCFD)

RBL Bank became a TCFD supporter:

In August 2022, the Bank became a supporter of Task Force on Climate-related Financial Disclosures (TCFD). TCFD recommendations are based on four pillars – governance, strategy, risk management, and metrics and targets. Given its remit from the Financial Stability Board, the TCFD is committed to market transparency. The RBI has also recommended adoption of the TCFD framework by Indian banks in its new climate risk consultation paper.

Measures to contain Bank’s own carbon footprint:

The Bank’s office in Goregaon has received the Platinum Green Certification from IGBC and will contribute towards building a sustainable environment. Other two large offices in Mumbai are also certified green buildings. The corporate office, Mumbai is also using 100% renewable energy.

The Goregaon office is using 100% renewable energy from September 29, 2022. With a monthly consumption of 1.11 lakh units, this initiative will help avoid emissions of 1,054 tCO₂ annually. This also reduces RBL Bank’s annual operational (Scope 1 and 2) GHG emissions by 11%, compared to FY21 contribution. The Bank has installed 96 kWp renewable energy in its 21 rural branches, Sangli office and Bank’s head office in Kolhapur, generating about 150 MWh of average solar power annually and avoiding GHG emissions of 139 tCO₂. In addition, the Bank finances various renewable energy, electric vehicles and other emission-reduction projects etc. This in turn also helps reduce total GHG emissions.

With a third-party benchmarking exercise on global best practices to implement TCFD recommendations, the Bank has developed a short-term action plan with some of the high-level objectives as below:

• E&S Risk team to drive climate risk management across the Bank: Climate risk-related goals to be incorporated in E&S Risk team’s KRAs, while responsibility of oversight rests with the Executive Director.

• Internal capacity development to address climate risk: The Bank will develop internal capability on climate risk by imparting specialized training.

• Develop a plan for addressing portfolio and transaction-level climate risks: Evolve a scientific approach to include climate risk while assigning internal credit rating.

• Develop targets to reduce own CO₂ emission intensity: The Bank’s E&S risk team along with corporate services team is working towards reducing environmental impact of own operations, e.g., energy intensity

RBL Bank will continue to strengthen its climate risk management practices by assimilating it in existing risk management framework.

RBL Bank realises importance of biodiversity to sustain life on earth and has included following initiatives that have negative impact in its exclusion list (not eligible for funding).

1) Production of or trade in any product or activity deemed illegal under host country laws or regulations or international conventions and agreements
2) Trade in wildlife or wildlife products regulated under CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora)
3) Purchase of logging equipment for use in primary tropical moist forest
4) Commercial logging operations for use in primary tropical moist forest
5) Production of or trade in pesticides/herbicides subject to international phase-outs or bans
6) Drift net fishing in the marine environment using nets in excess of 2.5 km. in length
7) Production of or trade in wood or other forestry products from unmanaged forests

Also, RBL Bank is a Primary Member of the Sustainable Palm Oil Coalition for India (I-SPOC). The members of I-SPOC commit to the goal - "Promote Sustainable Consumption and Trade of Palm Oil and its Derivatives in India along the Supply Chain". Please see various initiatives of the members on website: https://www.indiaspoc.org/about