What are Green Loans?
A green loan is any type of loan instrument made available exclusively to finance or refinance, in whole or in part, new and/or existing eligible green projects. The market is governed by the Green Loan Principles (GLP) first issued by the Loan Market Association (LMA), Loan Syndications and Trading Association (LSTA), and Asia Pacific Loan Market Association (APLMA) in 2018, most recently updated in 2023. The GLP are voluntary high-level principles ensuring transparency and integrity in the green loan market.
Four core components
- Use of Proceeds: proceeds must be applied to green projects (renewable energy, energy efficiency, pollution prevention, clean transport, green buildings, climate change adaptation, circular economy, etc.).
- Process for Project Evaluation and Selection: borrower clearly communicates sustainability objectives and the process to determine eligibility.
- Management of Proceeds: tracked through a dedicated account or otherwise; balance of unallocated proceeds appropriately invested.
- Reporting: annual reporting on use of proceeds, including allocation amounts and (where feasible) expected/actual impact.
Green Loan vs. Sustainability-Linked Loan
- Green Loan: use-of-proceeds; eligible green projects; pricing typically slightly below conventional.
- Sustainability-Linked Loan (SLL): general corporate purposes; pricing linked to sustainability performance targets (SPTs); no use-of-proceeds restriction.
External review
Borrowers may obtain external reviews — Second Party Opinion (SPO), verification, certification, scoring — particularly for syndicated or capital markets-adjacent transactions. EU Taxonomy alignment is increasingly an explicit eligibility filter for EU lenders.
Türk pazarında
Türk bankaları (TSKB başta olmak üzere kalkınma bankaları ve büyük ticari bankalar) GLP-uyumlu yeşil kredi ürünleri sunmaktadır. TBB (Türkiye Bankalar Birliği) ve BDDK rehberi yeşil kredi raporlama standartlarını desteklemektedir. Türk ihracatçılar AB tarafındaki yeşil kredi imkanlarını CBAM uyum yatırımları için kullanabilir.
Do: follow GLP four-component structure; obtain external review for material loans; align project taxonomy with EU Taxonomy or comparable national taxonomies.
Don’t: apply “green” label without GLP-aligned framework — accusations of greenwashing carry rising regulatory and reputational risk.