The Reserve Bank of India will be among 13 international regulators taking part in the Global Financial Innovation Network's (GFIN) first-ever Greenwashing TechSprint.
GFIN is a group of over 80 international organisations committed to supporting financial innovation in the interest of consumers and it is currently chaired by the Financial Conduct Authority.
"RBI as a participating member is inviting firms from India to participate in this Greenwashing TechSprint," the central bank said in a statement.
The number of investment products marketed as 'green' or making wider sustainability claims is growing.
Exaggerated, misleading or unsubstantiated claims about Environmental, Social and Governance (ESG) credentials damage confidence in these products and the RBI wants to ensure that consumers and firms can trust that products have the sustainability characteristics they claim to have, it said.
"RBI will therefore be participating in a virtual TechSprint, hosted on the FCA’s Digital Sandbox, to bring together international regulators, firms, and innovators to address sustainable finance as a collective priority," the central bank said.
The TechSprint will be to develop a tool or solution that can help regulators and the market effectively tackle the risks of greenwashing in financial services.
The RBI has invited all India-based firms which are interested in participating in the TechSprint to apply by May 21.
Firms will get the opportunity to work with regulatory experts, a variety of stakeholders and professionals from across the globe, it added.