South Africa’s new solar, inverter and battery loans kicking off with big banks

Standard Bank says that it is in the final stages of concluding agreements with the government that will see it participate in the Energy Bounce-Back Loan Guarantee Scheme, which will offer affordable solar loans to both households and businesses.

The scheme was announced by National Treasury earlier this year and is administered by the South African Reserve Bank. The aim of the scheme is to help customers mitigate the impact of power supply challenges and load shedding by giving them easy access to financing at a lower interest rate.

FNB announced earlier this week that it would be offering the loans by the end of the year, with the financing ultimately being offered around prime+1% (12.75% at current rates).

Standard Bank did not provide a launch window for the loans, but said that it will be offered to both personal and business customers in line with the limits set by National Treasury.

In addition to access to the loans, the group said customers would be able to benefit from the bank’s other solar-related services like the LookSee and PowerPulse platforms.

Home solar

Standard Bank said that the highlight of the home solar loan is that it will be offered at a personalised interest rate capped at the maximum of prime+2.5% (14.25% at current rates).

This is a discount on the prime plus 17.5% maximum stipulated by the National Credit Act and lower than the average prime plus 7% interest rate offered on personal loans, the bank said.

“Another benefit of the Home Solar Loan is the flexible repayment term of up to 5 years. This means that families can choose a repayment plan that meets their budgets, and should they pay the loan off earlier, they won’t be penalised either,” it said.

Home solar loans are limited to new or upgraded solar installations valued between R3,000 and R300,000.

The financing will cover the costs of inverters, batteries and installation.

Residential solar installations that come into use before 29 February 2024 will also be able to benefit from National Treasury’s home solar tax incentive.

The loan offering will be available on the bank’s home efficiency platform, LookSee.

Backup for businesses

The business solar loan will be added to Standard Bank’s existing renewables funding options by providing businesses that bank, as well as those that currently don’t bank with Standard Bank, access tp the funds.

The business loans cater for businesses with a maximum turnover of R300 million, and offers loans between R10,000 and R10 million with personalised interest rates also capped at prime plus 2.5%.

Repayment periods are also between 12 and 60 months (1 to 5 years).

“Specialised tailored solar loans will also be offered to solar installer and leasing businesses, as well as those in the green energy value chain, subject to the bank and scheme criteria,” the bank said.

The bank said its loan offerings are based on its participation in the government’s Energy Bounce Back Loan Guarantee Scheme, and additional terms and conditions may apply.

Read: Good news for inverters, rooftop solar and batteries in South Africa