Kenyan Banks Introduce New Plan Set to Change How Customers Apply for Loans

Kenyan banks have unveiled a new sustainable finance framework that could influence how financial institutions assess loan applications, manage risks and decide where to direct funding.

The Banking Industry Sustainable Finance Roadmap was launched on Tuesday, November 3, 2026, by the Kenya Bankers Association (KBA) in partnership with the International Finance Corporation (IFC) and WWF-Kenya.

The initiative seeks to integrate environmental sustainability, climate-related risks and responsible investment considerations into the operations of banks across the country.

Under the new framework, financial institutions will be encouraged to incorporate sustainability factors into their governance structures, risk management systems, lending decisions, reporting and allocation of capital.

This means banks could increasingly consider environmental and climate-related risks when assessing businesses and projects seeking financing, alongside their existing financial assessments.

The roadmap is also expected to strengthen the banking sector’s ability to identify potential risks associated with climate change and nature-related challenges while creating opportunities for investments in environmentally sustainable projects.

Micro, small and medium-sized enterprises (MSMEs) are among the businesses expected to benefit from the initiative as Kenya seeks to support enterprises transitioning towards more resilient and inclusive economic activities.

Speaking during the launch, Principal Secretary in the Ministry of Environment, Climate Change and Forestry Festus Ng’eno said the framework would strengthen the contribution of financial institutions to Kenya’s sustainable development ambitions.

“Environmental protection must be understood not merely as a conservation responsibility, but as an essential part of our economic planning and long-term prosperity,” Ng’eno said.

He added that achieving the country’s development objectives would require cooperation between national and county governments, banks, investors, businesses and development partners.

KBA Chairman and KCB Group Chief Executive Officer Paul Russo described the roadmap as an important step towards turning sustainability commitments into practical actions within the banking industry.

Russo explained that the framework would guide financial institutions in directing funding towards green projects, managing climate-related financial risks and strengthening sustainable business practices.

KBA Chief Executive Officer Raimond Molenje said the roadmap would bring together existing industry initiatives and provide clearer guidance on implementing sustainable finance across the sector.

IFC Regional Director for Eastern Africa Mary Porter Peschka also welcomed the initiative, saying it would help improve sustainability disclosures, strengthen risk management and mobilise investments that support economic growth.

Meanwhile, WWF-Kenya Chief Executive Officer Jackson Kiplagat said the next phase would focus on translating sustainability commitments into measurable actions affecting lending, investments and financial risk management.

WWF-Kenya is expected to support KBA and participating banks in developing Nature Transition Plans to advance the implementation of the framework.

However, the roadmap does not introduce an immediate blanket change to loan eligibility requirements. Instead, it provides a framework for integrating sustainability and climate considerations into banking decisions as the sector moves towards more responsible financing.

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