Right-Pricing Climate Risk: StepChange's Profitable Playbook for the Global South

From financing nations to funding homes, banks and financial institutions quietly shape the future more than almost any other industry. Climate change is the latest test of that power — and today, most institutions still lack the tools to price the risk accurately.

Giving them timely, reliable decision-making tools is a massive opportunity, and a hard one, because the underlying data is patchy at best. StepChange, a company in our portfolio, sits at the intersection of climate modelling and financial engineering, building the infrastructure needed to make that data usable at scale.

The result is a climate intelligence platform that some of India's largest banks now rely on for underwriting decisions. As early backers, we're glad to see the company closing in on profitability this year — a rare milestone in climate tech.

Founded in early 2022 by Ankit Jain, a former global management consultant and co-founder of Ola Electric, and Siddhant Pai, an MIT-trained environmental scientist, StepChange set out to build a unified platform for carbon accounting, ESG disclosures, and climate risk management — bridging the gap between scientific modelling and commercial decision-making.

By serving India's largest financial institutions, the company has moved sustainability from a good-to-have reporting exercise to a core pillar of strategic underwriting.

“More than the revenue, our focus this year — and we're quite confident — is that we'll become profitable,” Jain says.

“We can choose to grow as fast as we want and consolidate when times are tough. We wanted to be in control of our own destiny.”

StepChange's relevance will only grow. Global energy-related CO2 emissions hit a record 37.8 gigatonnes in 2025, and Asia-Pacific's annual climate-disaster “protection gap” widened to $424 billion. Atmospheric CO2 concentrations now sit roughly 50% above pre-industrial levels. Pricing resilience accurately isn't optional for the financial sector anymore — it's overdue.

CLIMATE KYC

This is powered by technical innovation built specifically for finance. StepChange is pioneering what it calls “Climate KYC” — an effort to make climate risk assessment as routine and affordable as standard identity verification in loan underwriting.

Their platform already supports climate-risk decisions across several of India's largest lenders. By integrating geospatial data with bottoms-up climate models, StepChange helps banks stress-test portfolios against extreme weather events — monsoon failures, urban flooding, and similar events.

“The innovation has been building India-specific models and extending that to other emerging markets — climate models, bottoms-up.”

BEYOND RISK MEASUREMENT

The company is also moving beyond pure risk measurement into green, adaptation and transition finance — working with banks to design products that help businesses and homeowners fund resilience upgrades and decarbonise operations which in turn lowers the bank's long-term credit risk.

StepChange also offers a fully decentralised, on-premise deployment option, so sensitive customer data never leaves a bank's own infrastructure — a design choice that has helped it expand into emerging markets where data localisation requirement are binding.

THE ROAD AHEAD

Looking ahead, the biggest opportunity lies in the vast, emerging markets of the Global South. As emerging economies recalibrate transition timelines and regulators like the RBI finalise climate disclosure frameworks, the need for affordable, sovereign climate models will only grow.

For us at Speciale, StepChange is the archetype of what climate tech should look like: elite scientific pedigree paired with the commercial grit to address a planetary crisis in a self-sustaining, and increasingly profitable, way.