Brief: Current Landscape of NbS Financing Models and Incentives

Currently, there is a range of nature-based solutions (NbS) emerging, primarily supported by strong public funding, but a comprehensive market for NbS has not yet emerged. Despite the growing prominence of NbS in scientific and policy discussions, information and evidence pertaining to successful financing and incentive mechanisms remain fragmented and not readily accessible.

To address this gap, Invest4Nature has mapped the current state of the market for financing NbS in a full report to explore the potential for increasing private sector engagement. This includes a systematic literature review of the state-of-the art for NbS financing models and incentives and an analysis of the needs and perspectives of different market players, including the public sector, the investor community and Nature-based Enterprises (NbEs).

The systematic review explored the effectiveness of various financing models and incentives across different NbS types, scales of investment, and challenges. The findings aimed to provide a better understanding of suitable financing models and incentives to drive future Nbs financing.

This brief presents insights of the Invest4Nature (I4N) systematic literature review of the state-of-the art for NbS financing models and incentives:

• Trends in the current landscape
• Scale of NbS projects
• Source of financing
• Investment effectiveness
• Main drivers
• Main barriers
• Policy recommendations to enhance the scalability and effectiveness of NbS
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