Green Financial Support for Green Drivers
Accounting/Finance, Banking/Mortgage, Green, Product
February 24, 2019, 10:03 am
Strong Local Commitment
The Middle East, and especially the UAE – which aims to reduce carbon emissions by 2020 – are active early adopters of EVs. Dubai will spend millions of dirhams on incentives to have 42,000 EVs on its streets by 2030. Agencies across the board are supporting the transition to EVs, such as Roads and Transport Authority (RTA), who have invested in 300 hybrid taxi, or DEWA who have already implemented 100 electric-car charging stations in Dubai (budget allocated AED 10 million).
With such a considerable support, there is no wonder that banks across the UAE are providing green car loans for citizens and residents who wish to drive in environmental style.
Emirates NBD (ENBD) and HSBC UAE were the first banks in the UAE and in the Middle East to offer green auto loans. ENBD launched the Green Auto Loan in January 2017, in response to the growing interest from residents in supporting a green and sustainable economy in the UAE. Customers interested in investing in electric or hybrid cars sold from approved auto dealerships in UAE are eligible to apply for the Green Auto Loan, which offers half day approvals, 0.50% discount on reducing interest rate and 50% cash back on processing fees.
Citizens and expatriates aged 21 to 65 years old, who earn a minimum monthly salary of AED7500 can apply for the HSBC Green Auto Loan and can borrow a minimum of Dh30,000 and a maximum of Dh918,000, depending on their eligibility, which offers 50% discount on the applicable arrangement fee and up to 0.25% discount on the applicable interest rate.
Sharia-compliant Green Auto Loan
As part of its commitment towards the green initiative, Emirates Islamic introduced the Sharia-compliant Green Auto Finance Loan in 2018. The financial product is available to customers earning more than AED5000 per month.
National Bank of Fujairah
National Bank of Fujairah (NBF), signatory to the Dubai Declaration on Sustainable Financing since early 2017, launched their own green auto loan in 2018. Customers who are UAE nationals and expat residents aged 18 years are eligible to apply for the Green Auto Loan, up to AED 1 million in financing, over a period of up to five years. NBF’s Green Auto Loan offering has an interest rate of 2.2%.