The light industry sector—including textiles, footwear, food and beverages, and hospitality—contributed an estimated 1.025 million gigatons of CO₂e emissions globally in 2019. This figure accounts for approximately 8% of global greenhouse gas (GHG) emissions, exceeding the combined emissions of the aviation and shipping sectors. In Indonesia, light industry employs around 4.5 million workers, making it a critical area for policymakers to address in order to maintain national competitiveness while reducing associated emissions.

This document outlines the key challenges faced by financial institutions and industries in financing supply chain decarbonization within the light industry sector, particularly among medium-sized enterprises. It also presents a range of innovative financing approaches that have the potential to address the existing financing gaps.