If you're worried about being cold this winter, imagine living in Ulaanbaatar, Mongolia -- the coldest capital city in the world -- where winter temperatures fluctuate between -15°C to -30°C.

Beyond the chill, air quality is dangerously bad during the city's coldest months. In fact, Ulaanbaatar is quickly becoming the world's most polluted city -- a dubious distinction, considering its population is only 1.2 million (vs. New York's 8.2 million).

Because most households use coal as a heat source, the air pollution is so thick that it's led to many cases of chronic bronchitis, respiratory illness, cardiovascular disease and even premature death. And, as usual, women and children bear the brunt.


Ulaanbaatar photographed by Kiva Fellow Jon Hiebert.

To combat these problems, Kiva posts a lot of green loans for Mongolian borrowers. We're excited to offer loans in this region that promote sustainable energy use, organic farming, solar technologies and more.

That said, we've heard from a number of lenders who are concerned that some of the Mongolian loans labeled as "green" don't seem especially environmentally-focused. Not surprisingly, we see a lot of them expire. We get it. Many of these loans are also tagged for "personal use," "transportation" and "housing" -- which seems counterintuitive.



But, if you dig just a little deeper, you'll see how loans that may give you pause actually do serve the environment in critical ways.

Let's look at some examples...



Meet Amarjargal. This 33-year-old father of two (ages 6 and 2) is requesting a $2,150 loan to insulate the walls and roof of his house. He's one of many Mongolian borrowers looking for green loans to improve their homes. But this isn't just about lifestyle improvement.

Amarjagal and his wife, Altansuvd, 29, moved into this home as newlyweds expecting a baby. There wasn't a lot of money to go around, so they moved into a cheaper house made of lower-quality materials. While Amarjagal has been fixing it up over the years, it still gets far colder than neighboring homes. The family has to burn more coal just to keep warm -- making the air less breathable inside and out.

A loan will enable Amarjagal to do some higher-cost work on his house, namely insulation, which will make a big difference keeping heat in and the cold out. As a result, his family will need to burn less coal to stay warm -- saving money and reducing smoke inhalation -- all while emitting far less greenhouse gases, which is good news for the local environment too.



This is Sarantsetseg. At age 45, she's been supporting her husband and three children with her dairy products business for 17 years. She sells food in their local market and the larger markets in Ulaanbaatar, and has requested a $4,325 loan to buy more materials and expand.

Change doesn't come easy to older, established businesses. But new organic farming process are not only cheaper and healthier, they're also much more productive despite Mongolia's short warm season. Sarantsetseg's loan is part of a special program through Kiva Field Partner XacBank that encourages conversion to organic processes.

In short, borrowing the money will enable Sarantsetseg to save money, up her productivity and continue to grow, while also reducing her impact on the local environment.

While Kiva works with several partners to provide green loans to Mongolian borrowers -- including Transcapital and Credit Mongol -- XacBank in particular has invested a lot in creating and offering impactful green loan products to environmentally-friendly businesses.

Today, over 107,000 families living in and around Ulaanbaatar have benefited from this initiative. And it shows. Coal consumption in the area has decreased by 157,000 tons, and households have already saved a collective $2.6 million in heating costs in 2012 alone. By the end of the year, XacBank's work will have reduced emissions from home stoves by an estimated 25% -- preventing 450,000 tons of greenhouse gases from being released into the atmosphere.

So, next time you want to lend to help the planet, take a closer look at Mongolia.

We here at Kiva are always working to make loans easier to find and understand -- and we're definitely brainstorming ways to make green loans more obvious. In the meantime, though, don't write off loans that may not be bright green on the surface. They're making a difference too, one insulated roof and hybrid taxi at a time.

Inspired? Find a Mongolian green loan now.

Have questions? Comments? Send them our way at blog@kiva.org.

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