Towards a greener future: The impact of financial technology (FinTech) and climate finance on ecological sustainability.

Ecological sustainability has become a top priority for worldwide policymakers due to severe consequences. Innovative approaches, like climate finance and financial technology (FinTech), are crucial in combating climate change and its environmental hazards. This study aims to investigate the role of climate finance on ecological sustainability with FinTech and institutional quality as moderators from 2010 to 2022 in 58 advanced countries. Besides that, the COVID-19 spillover shock effect (pre-post), socio-economic conditions, and trade openness are also considered as other variables in this study. The study employed the two-step Sys GMM approach, and the robustness was checked by the D-K regression and bootstrap panel quantile regression for empirical analysis. The results reveal that climate finance improves the trajectory of long-term ecological sustainability by significantly lowering the ecological footprint (EF). FinTech has a strong positive effect on ecological performance by decreasing the EF. Furthermore, the combined influence of CF∗FinTech has significantly boosted ecological sustainability by diminishing the EF. Institutional quality substantially enhances ecological sustainability by reducing the EF. Similarly, the interaction term CF∗IQ improves ecological performance by lowering the EF. The outcomes have significant implications for sustainable development policy, influencing the transition to low-carbon economies and meeting net-zero emissions within this decade, contributing to improved ecological sustainability.