(Bloomberg) -- The U.K. will offer its first green savings bonds to retail investors from Friday, betting citizens are willing to pay to fund the country’s efforts to mitigate climate change.
The savings bonds will finance projects including renewable energy, greener transport and climate change adaptation, according to a statement from NS&I, a state-backed savings bank. The money will need to be tied up for three years and will pay a fixed 0.65% rate of interest.
That’s lower than retail investors currently get from its conventional retail debt, known as premium bonds, which offer prizes that equate to about 1% a year. Still, polls show U.K. voters increasingly see climate change as a top concern and the government is pushing for solutions ahead of hosting a major United Nations climate gathering.
“The U.K is already a world leader in green finance and these innovative new savings bonds will deliver both financial returns and environmental benefits, in a transparent and secure way,” said Chancellor of the Exchequer Rishi Sunak in a statement.
Until now, the U.K.’s green finance program has been targeted at institutional investors such as pension funds. The U.K. sold its second green gilt on Thursday after its debut last month broke records for orders.
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