Lender FNB has bolstered its residential solar financing solutions, with a new option that allows clients to add a loan facility to their existing bond to fund the installation of solar energy systems to their homes.
The “energy home loan” utilises available funds in an existing mortgage bond, or can be added to a new home loan, Sizwe Nxedlana, FNB’s private segment CEO said on Monday.
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Clients can access loan amounts starting from R50 000, and to a maximum of 15% of the value of their home, he said.
The customer’s property valuation, FNB said, will be increased to cater for the future installation of the solar energy system and the solar energy loan added to the customer’s bond, which will be recorded as a single loan. The interest rates at which the loans are offered are specific to individual credit profiles, FNB said.
“FNB will pay the deposit directly to the supplier upfront, so the customer will not be out of pocket unless there is a difference between the approved loan amount and the cost of the renewable energy solution selected by the customer, in which case the customer pays the difference or selects a more affordable solution,” the bank said.
With South Africa’s energy supply crisis seeing no end, banks have been widening funding options, particularly for the residential market, where the take-up of solar has largely been slow. While in the long-run solar is cheaper than Eskom’s electricity, the initial cost of buying into these alternative solutions has remained the biggest disadvantage for homeowners looking to be less reliant on the beleaguered utility.
FNB’s new energy loan is its latest solution for homeowners seeking to get off the grid and it is complementary to its ecoEnergy home loan, which was introduced in 2021.
Under ecoEnergy, FNB has financed 61 megawatts of alternative energy over the last two years, totalling nearly R1 billion.
“We aim to reach R2 billion by the end of June next year,” Nxedlana said.
“We’re also providing energy finance through securities-based lending, so if you have a share portfolio, you can borrow to fund energy and use that as a security or through an unsecured personal loan,” he said.
The bank has also set up a one-stop shop on its app, where customers can purchase backup power solutions, such as UPS devices or inverters, from R149 per month, over a payment term of 24 months.
