BNP Paribas has signed an agreement with China’s Ant Group on a bilateral sustainability linked credit facility arrangement that will support Ant Group in implementing its ESG strategy and carbon neutrality roadmap.

Under the terms of the agreement, the French banking giant will offer revolving credit lines to Ant Group that come with a “two-way interest rate adjustment mechanism” tied to a number of the Company’s SPTs (Sustainability Performance Targets).

As an example, the SPTs stipulate that Ant Group will adhere to the company’s green and sustainable development commitments, including those on reaching carbon neutrality, using renewable energy and donating a certain percentage of the company’s annual sales revenue to biodiversity conservation and environmental protection projects.

Each year, the Bank will verify these SPTs using Carbon Matrix, AntChain’s enterprise carbon management SaaS (software-as-a-Service) product.

Carbon Matrix is built upon blockchain technology which ensures that the verification process is transparent and tamperproof.

If the SPTs are met, the interest rate on the SLL will be lowered, if they are not, the interest rate will be raised. The arrangement is designed to incentivize companies to actively implement their sustainable commitments.

BNP Paribas’ partnership with Ant Group comes after the company announced in April that it has achieved carbon neutrality in its own operations since 2021, and is on track to reach net-zero in all carbon emissions throughout the company’s value chain by 2030.

Commenting on the move, CG Lai, chief executive of BNP Paribas China, commented: "The financial services industry has an important role to play in driving the real economy towards China’s ESG and 'dual carbon' goals.

“Sustainability is deeply embedded across all aspects of BNP Paribas, from our long-term strategy to everyday operations, and Ant Group is an avid advocate for ESG development globally. Our similar vision for a sustainable future has laid the foundation for more joint achievements and innovations across sustainable finance in the future”

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