Singapore's banks have approved loan criteria that could be used to deny funds to companies linked to the haze from Indonesia that's polluting the city state's air.

The 158-member Association of Banks in Singapore approved guidelines to include greenhouse gas emissions, deforestation, forest degradation and biodiversity loss among the criteria for granting loans, Agence France-Presse reported. The criteria would apply to the forest-burning that's causing the haze.

Indonesia burns forests every year to make way for palm-oil tree and paper plantations, and winds carry the smoke to Singapore, Malaysia and Thailand. On Thursday, Indonesian President Joko Widodo did an about-face and said he would accept help from Singapore, Malaysia, Japan and Russia to stem a problem he said could take three years to fix.

The banks' action follows a suit Singapore filed against five companies linked to the forest-burning two weeks ago.

Singapore's biggest supermarket chain, NTUC Fairprice, also stopped selling products of Asia Pulp & Paper, whose suppliers are suspected of involvement in some of the forest-burning.