Green loans and eco finance in Australia

What is a green loan?

A green loan is a personal loan specifically for environmentally friendly purchases. Common uses include solar panel systems, battery storage, electric vehicles (EVs), energy-efficient appliances, insulation, double-glazing and rainwater tanks.

Several Australian lenders offer discounted rates for green purposes compared to their standard personal loans. The logic is that green upgrades typically reduce your ongoing costs, such as electricity bills, which improves your ability to repay.

Who offers green loans in Australia?

Bendigo Bank has both secured and unsecured green personal loans. SocietyOne offers a green loan product. Alex Bank has a dedicated solar loan. Brighte provides buy-now-pay-later style finance specifically for home energy upgrades through approved installers.

Solar loans

A 6.6 kW solar system typically costs $6,000-$8,000 installed. With an average household saving around $1,500-$2,000 per year on electricity, the payback period is roughly 3-5 years. A solar loan with a 5-year term at a competitive rate often makes financial sense even accounting for interest costs.

EV loans

Electric vehicles in Australia typically start around $40,000 and go up to $80,000+ for premium models. Several lenders now offer EV-specific car loans at rates below standard car loan rates, partly because EVs hold their value well and partly to incentivise uptake.

What to look for

• Compare the rate against a standard personal or car loan. The green discount should be real, not just marketing.
• Check whether the lender requires the purchase to be from an approved supplier.
• Some green loans require proof of installation before releasing funds.