The Inter-American Development Bank (IDB) has developed a financing tool that rewards countries for achieving nature and climate-related goals called “IDB CLIMA.”

The mechanism is currently in pilot phase and will provide the borrower with a discount when nature and climate objectives of selected loan projects are met. The discount is provided in the form of a grant, in the amount of 5% of the loan’s principal. The program will also finance the strengthening of national systems for environmental measurement, reporting, and verification (MRV).

IDB will grant a total of up to 1 billion dollars in loans from the Bank’s Ordinary Capital to a maximum of 10 projects chosen for the IDB CLIMA pilot phase. Selected projects will also receive non-refundable technical assistance and a specialized support team.