5 November 2024, Tue |
12:04 PM
Mashreq, a prominent financial institution in the MENA region, has entered into a Memorandum of Understanding (MoU) with Fils, a fintech firm based in the UAE. The collaboration aims to develop a corporate carbon offsetting solution, allowing corporate and institutional clients to seamlessly integrate carbon offsetting directly from their Mashreq corporate accounts.
Fils, an innovative digital platform, serves as the foundational infrastructure for financial institutions, banks, and organizations across various industries. It enables the launch of sustainable-focused products such as carbon offsetting, supporting the shift towards an Environmental, Social, and Corporate Governance (ESG) compliant corporate landscape. This facilitates businesses of all sizes to effortlessly incorporate sustainability and climate action into their models and customer journeys.
To address concerns about greenwashing, Fils utilizes blockchain technology to track carbon credits, ensuring transparency and avoiding double counting. The MoU was signed at Mashreq’s Global HQ by Nameer Khan, the founder of Fils, and Joel D Van Dusen, Mashreq’s Head of Corporate and Investment Banking Group, with the support of H.E. Juma Al Kait, the UAE’s Chief Trade Negotiator and Assistant Undersecretary for International Trade Affairs at the Ministry of Economy.
This collaboration marks the initial phase in Mashreq’s development of specialized carbon-offsetting financial products, set to launch in collaboration with selected UAE-based corporate clients. Anticipated in the first half of 2024, this announcement represents a pivotal moment for the region’s financial sector, showcasing a significant shift towards incorporating environmental responsibility into financial practices.
Within the UAE, carbon credits play a crucial role in the decarbonization strategy. The partnership between Mashreq and Fils aims to address historical challenges, making trading markets directly accessible to corporates. Additionally, it eliminates the typical constraints of minimum purchase amounts, as Fils provides fractionalized credits, simplifying the process for Mashreq’s clients.
Joel D Van Dusen expressed that this initiative would significantly impact Mashreq’s corporate clients, contributing to environmental sustainability. He highlighted the UAE’s role as a pioneer in integrating sustainability into its economic and financial sectors, aligning with its hosting of COP28 and commitment to global sustainability efforts.
The MoU with Fils aligns with Mashreq’s sustainable finance initiatives under its Climb2Change ESG platform. This international initiative combines the bank’s ESG milestones with its efforts to shape a sustainable future and combat climate change.
Mashreq’s carbon offsetting offering is a unique product reflecting the increasing use of carbon credits globally. Fils Founder, Nameer Khan, emphasized that the partnership with Mashreq represents a catalyst for ESG enforcement in the region’s financial markets, providing transparent KPIs to combat greenwashing and promote accountability.
Fils, founded by Nameer Khan, Chairman of the MENA Fintech Association (MFTA), aims to integrate ESG values into companies’ operations. The product’s uniqueness in the UAE market, coupled with its alignment with COP28, highlights a forward-thinking approach in the banking sector towards environmental responsibility.
Mashreq’s announcement aligns with the UAE’s commitment to achieving net-zero emissions by 2050, reflecting the growing global voluntary carbon market and demonstrating a dedication to domestic and international environmental sustainability efforts. As a responsible financial institution, Mashreq is committed to supporting sustainability-related innovation in the fintech ecosystem, reinforcing its pledge to customers for a sustainable future and contributing to the UAE’s position as a global financial innovation and excellence hub.
