SINGAPORE (Mar 11): When British housing association London & Quadrant needed a £100 million ($178.3 million) loan last year, its bank offered something unusually generous: a discount on interest if L&Q met an annual target of helping 600 unemployed residents find work.

Eight months later, L&Q, which builds and rents out affordable housing in London, is already more than 75% of the way there, putting it on course to unlock savings from its lender, BNP Paribas.

While it is hard to imagine the world’s profit-driven banks offering incentives for doing good, corporate lending tied to some measurable sustainability metric — such as cutting emissions or reducing food waste — surged eightfold in 2018 to US$36.4 billion ($49.4 billion), according to Bloomberg NEF, a research organisation that helps energy professionals generate opportunities.

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