In the face of urgent environmental, economic and social challenges brought on by climate change, Bangladesh Bank is leading the country’s transition to a greener and more inclusive financial system.

Bangladesh Bank (the central bank of Bangladesh) has long recognized that financial services play a vital role in enabling the poor and vulnerable to cope with financial shocks, including those from climate change. In fact, it is one of the first central banks in the world to explicitly link financial inclusion and climate change and enact strategic plans and policies that help those at the bottom of the pyramid to manage and mitigate the financial, social and environmental impact of climate change.

The purpose of this case study is to clarify the important link between financial inclusion and climate change and to add to a growing body of evidence of how financial regulators are addressing pressing issues of climate change mitigation and adaptation for those at the bottom of the pyramid. It examines the work of Bangladesh Bank to enact policies aimed at transitioning the financial sector to a green economy and helping the population cope with financial losses from climate change and adapt to new livelihoods and environmental realities.