The GAIA Climate Loan Fund has successfully completed its initial close, securing $600 million in capital. This milestone marks the beginning of a significant financial initiative aimed at supporting climate adaptation efforts in regions that are both highly vulnerable to the impacts of climate change and lack the resources to effectively respond.
The fund is designed to provide long-term loans to projects that enhance climate resilience, particularly in developing markets where adaptation needs are most urgent. GAIA is targeting a total fund size of $1.48 billion, with its final close expected by 2027.
GAIA was co-founded by three major institutions: MUFG, Japan’s largest financial group; FinDev Canada, a Canadian development finance institution; and the Green Climate Fund, a global fund established to support climate action in developing countries. The fund is managed by Climate Fund Managers (CFM), a leading investment firm specializing in blended finance solutions for climate-focused initiatives.
To support the fund’s delivery and strategic implementation, GAIA is also backed by Pollination, a global advisory firm with expertise in climate and nature-based solutions.
Andrew Johnstone, CEO of Climate Fund Managers, emphasized the significance of this development, stating:
GAIA represents a pivotal evolution in CFM’s approach to climate finance. For the first time, we are extending our blended finance model beyond private equity into the realm of private credit. This enables us to offer long-term financing for adaptation projects that strengthen the resilience of communities most exposed to climate risks. The successful first close of GAIA builds on the momentum of our Climate Investor One, Two, and Three equity funds, which have collectively mobilized investments in over 50 climate-related projects across emerging markets.
GAIA’s launch underscores a growing commitment among global financial institutions to address the urgent need for climate adaptation financing, particularly in underserved regions where the effects of climate change are most pronounced.
