Physical climate risks refer to the direct impacts of climate change on assets and businesses. These include extreme weather events such as floods, storms, and droughts, as well as longer-term shifts like rising sea levels and changes in temperature, which can disrupt operations and lead to asset damage.

Physical climate risks can directly affect a borrower’s ability to repay loans. Damage to assets, disrupted supply chains, and increased operational costs due to climate-related events can compromise financial stability. By assessing these risks, lenders can make more informed decisions, mitigating potential financial losses and promoting sustainable lending practices.

PeerCarbon’s platform uses data from multiple sources, including IoT sensors, satellite imagery, and environmental models, to assess the exposure of assets to physical climate risks. We provide detailed insights on location-based vulnerabilities and how they could affect operations in both the short and long term.

Incorporating physical climate risks into green loan underwriting enables lenders to price loans more accurately, reflecting the true risk profile of a borrower. This ensures that loans are not only environmentally impactful but also financially sound, reducing the likelihood of defaults due to unforeseen climate impacts.

Regulatory frameworks like the Task Force on Climate-related Financial Disclosures (TCFD) emphasize the need for financial institutions to account for climate risks in their lending portfolios. PeerCarbon’s reports are aligned with these frameworks, helping lenders comply with global standards.

Yes, PeerCarbon’s platform integrates easily with your existing loan management and credit scoring systems, providing seamless access to climate risk data. This ensures that you can include physical climate risks in your lending decisions without disrupting your current workflow.