South African bank FNB is expanding its financing options for solar and alternative energy solutions to assist businesses and consumers in mitigating the impact of load shedding, a persistent power supply issue in the country.
The bank has announced several new financing options, including an energy home loan that allows clients to add a loan facility to their existing mortgage bond to fund the installation of solar energy systems. The loan amounts start at R50,000 and go up to 15% of the value of the client’s home, with interest rates aligned with individual credit profiles. The solar energy loan can also be added to a new home loan.
FNB also offers energy finance through securities-based lending or an unsecured personal loan.
The bank has created a “one-stop-shop” on its app, where customers can purchase backup power solutions such as UPS devices or inverters starting from R149 per month over a 24-month payment term. There is no paperwork involved in accessing these financing options, as the process is fully digitized and accessible through FNB’s platform.
Reputable providers
The bank says it is partnering with reputable renewable energy providers to offer pre-screened lists of alternative energy solutions. It will pay the deposit directly to the supplier upfront, ensuring that customers are not out of pocket unless the cost of the renewable energy solution selected by the customer exceeds the approved loan amount.
The new financing options complement existing ones, such as the ecoEnergy home loan, which has financed 61 megawatts of alternative energy, paid out R970 million to date and aims to reach R2 billion in green-energy home loans by June 2024.
With the energy supply crisis in South Africa showing no signs of slowing down, banks are widening funding options, particularly for the residential market where the uptake of solar has been slow due to the initial cost of buying into these alternative solutions.
While in the long run, solar is cheaper than Eskom’s electricity, the cost of buying into these alternative solutions has remained the biggest disadvantage for homeowners looking to be less reliant on the beleaguered utility.
Bounce Back billion
FNB also announced that it is on track to fund R1 billion in Bounce Back Loans to SMEs by May 2023. These loans have a government guarantee and low-interest rates, and FNB has already extended nearly R900 million in Bounce Back Loans, with R262 million funding Women in Business.
FNB’s credit offerings include the Aspire credit card, which offers eBucks rewards and access to SLOW Lounges when purchasing tickets via eBucks Travel. Customers can also create a virtual card stored on the FNB App, and some virtual card purchases qualify for Purchase Protect insurance. FNB’s Fusion account, with a starting credit limit of R1000, allows customers to build their credit profile and has a credit facility for emergencies with zero interest for 30 days.
FNB CEO, Jacques Celliers said, “As a responsible financial institution, we are committed to making a positive impact in society, and we recognize the challenging impacts of the current economic environment on our customers. Our aim is to provide customers with ongoing support to help them realize their individual, family, and business aspirations. We intend to do this through our extensive range of needs-based solutions.”