<p>Recent international climate agreements, including COP28, have emphasized the necessity of financial reforms to accelerate renewable energy adoption for achieving net-zero carbon targets. While existing research extensively examines renewable energy’s role in climate change mitigation, a significant challenge persists in the limited availability of financial resources, constraining the widespread adoption of sustainable energy solutions. This study addresses this gap by investigating how financial inclusion moderates the relationship between renewable energy consumption and trade-adjusted carbon emissions in the emerging seven (E-7) economies from 2000-2023. Using the Method of Moments Quantile Regression (MMQR) to account for heterogeneous effects, our analysis shows that while renewable energy significantly reduces trade-adjusted carbon emissions, financial inclusion exhibits a positive effect on emissions, suggesting that expanded financial access currently facilitates carbon-intensive economic activities. Moreover, the interaction between financial inclusion and renewable energy is positive across all quantiles, indicating that financial inclusion reduces rather than amplifies renewable energy’s emission-reducing impact. This moderating effect is strongest at lower emission quantiles, where renewable energy shows maximum effectiveness (-0.283) but is substantially weakened by financial inclusion. Energy intensity and economic growth are associated with higher carbon emissions across all quantiles. These results challenge conventional assumptions about financial development’s environmental benefits and underscore the need for green finance frameworks that align financial inclusion with climate goals. Without such targeted interventions, the expansion of financial services may inadvertently undermine renewable energy investments and hinder progress toward sustainable development in E-7 economies.</p>