Although modern society couldn’t have developed without the finance sector, it’s come at a cost to people and the planet. Inequality has increased and the Earth faces serious environmental threats. In 2015, world leaders came together to find solutions, and agreed on 17 global goals for 2030 that include poverty alleviation, reduced inequalities, and environmental sustainability. The Stockholm Fintech Hub aims to be part of the solution in using fintech to open new opportunities for sustainable finance and new models for environmental initiatives.

Late last year, the United Nations Environment Programme (UNEP) Inquiry published their Fintech and Sustainable Development report, giving guidance for the Fintech sector. The report’s targets are broad-reaching and ambitious, using a combination of cutting-edge and existing technology, alongside policy changes, to help address a variety of social and environmental problems.

Sweden has now been identified as a country with both the appetite and the resources to set up trials to meet the UNEP’s targets. “The time and place are right to build this pilot. UNEP need a supportive environment to try out their recommendations, which are exactly aligned with Sweden’s values,” says Matt Argent of the Stockholm Fintech Hub, which is kicking off the Green Digital Financial Centre. “Alongside the fintechs, the Hub ecosystem includes incumbent banks, academic and legal communities, working together to build future finance. It’s a perfect environment to launch these recommendations.”

The Stockholm Fintech Hub, freshly opened, sits above Stockholm’s Central Station, in the heart of a city which is home to nearly 200 fintech startups. Some of these fintechs are ethical trading platforms and funds encouraging sustainable investment with transparent, green portfolios, while others are working on new social and business models.

Structural inefficiency in today’s economies and lack of transparency disadvantages individuals and communities, and targeting this asynchronous balance of power is key to many of the recommendations. One such transformational Nordic Startup is hiveonline, which is partnering with the Hub and UNEP to build technical solutions for many of the more ambitious proposals.

hiveonline CEO Sofie Blakstad, says: “We’re calling it “democratising trust” because it takes away the need for trust authorities like credit rating bureaus or banks, so communities can evaluate each other based on facts. We enable communities to provide services or own things in common, like agricultural equipment or a sustainable energy source. Our contracts and trust transparency mean that businesses can team up with other businesses without needing central control, and interact directly with customers.”

Sustainable initiatives like this aren’t new. The island of Samsø in Denmark was the first place to produce more energy through renewables than it consumes, showing the power of the community owning energy sources and making decisions. Greater economic power and transparency in how businesses interact help communities make longer term decisions about things which impact the community, in particular its environment, as Samsø has demonstrated, but addressing this at scale is a challenge.

The UNEP recommendations, supported by fintech, will build community empowerment and education models in communities which might be physically distributed. “Sweden is a world leader in these type of initiatives so it’s a great place to support UNEP in achieving its goals, and we’re super excited to have the opportunity to work on such a transformational project,” says Blakstad.

The project is identifying priority targets for build over the next few months. Blakstad and Argent are also working across international barriers, with Fintech Hubs in the Nordics and elsewhere and the green Fintech community globally, for support in building sustainable financial solutions for the future. They are hoping to bring together sustainable fintechs in a parallel event to SIBOS in October, so if you would like to be involved, please get in touch.