OECD proposes policy priorities for AI use in SME sustainable finance

The Organisation for Economic Co-operation and Development (OECD) has published a policy paper examining how AI and digital tools can help small and medium-sized enterprises (SMEs) gain better access to sustainable finance, where they remain significantly underrepresented.

The paper maps practical applications of AI and digital tools across the entire financing lifecycle, from sustainability data generation and reporting by SMEs to loan origination, credit assessment and portfolio monitoring by financial institutions. The OECD notes that AI has the potential to support the front, middle and back office of lending operations rather than a single stage of the financing process.

Drawing on country examples and recent initiatives, the OECD argues that technological adoption must be accompanied by appropriate governance. It identifies four policy priorities: developing interoperable data infrastructure, strengthening verification mechanisms, creating incentives for SME sustainability reporting and ensuring accountable use of AI in financing decisions.

Why does it matter?

Small and medium-sized enterprises account for much of economic activity and employment but often struggle to access sustainable finance because they lack the resources to produce the data and reporting required by lenders and investors. AI could reduce these costs by automating data collection, reporting and credit assessment, making green finance more accessible to smaller businesses.

The OECD also emphasises that technology alone will not close the financing gap. Real progress depends on reliable data infrastructure, effective verification and clear governance to ensure AI-supported financing decisions are transparent, accountable and fair, preventing existing inequalities from being reinforced.

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