The contribution of green finance to environmental sustainability exploring the moderating role of fintech

Abstract

amid growing concerns over climate change and environmental degradation, green finance has emerged as a critical mechanism for promoting sustainability. this study explores the effect of green finance on reducing environmental degradation, using co₂ emissions and ecological footprint as key indicators. by leveraging an s-gmm estimator, findings indicate that green finance significantly mitigates environmental degradation, with stronger effects observed in developed economies. furthermore, fintech’s integration into green finance enhances the efficiency of financial flows, reducing capital constraints for green investments. however, disparities persist across regions, with asia and africa exhibiting weaker effects compared to europe and the americas. policymakers should prioritize regulatory frameworks that incentivize green financial instruments and technological innovations to maximize environmental benefits. this study contributes to the growing body of literature on sustainable finance and underscores the importance of fintech as a complementary force in green financial ecosystems.