Every day, the cost of electricity increases. Everyone you meet wants to switch to solar power. You can install a solar system on a monthly installment basis with bank financing.
On June 20, 2016, the State Bank of Pakistan released the Revised SBP Financing Scheme for Renewable. With the help of this program, commercial banks and development finance institutes (DFIs) can lend money easily to individuals, businesses, farms, and small and medium-sized enterprises (SMEs).
This may lower the cost of solar energy and increase its accessibility for a larger group of people. Many banks provide solar financing options under the SBP Renewable Energy Program, but each has its own terms and restrictions. An overview of some of Pakistan’s most well-liked solar finance programs will be given in this article.
1. JS Smart Roshni Solar Solution Financing
Solar loans are also provided by JS Smart Roshni Solar Solution Financing by JS Bank. With a payback period ranging from three to seven years, the initiative provides funding up to PKR 3.5 million. There is a set markup of 6% annually.
Pros:
- Reduced Electricity Costs: Helps businesses lower their electricity bills through solar energy.
- Coverage: Includes coverage for batteries.
- Flexible Financing: Available on installments, making it more affordable to adopt renewable energy solutions.
- Wide Financing Range: Offers financing between PKR 500,000 and PKR 10,000,000.
- Targeted for SMEs: Designed specifically for small and medium enterprises based on business cash flows.
- Comprehensive Coverage: Includes resources for installation through JS Bank’s authorized vendors.
Cons:
- Equity Requirement: Requires a minimum equity of 20% of the total solution quotation value.
- Collateral and Guarantees: Requires any collateral, hypothecation of the energy solution, a personal guarantee, and post-dated cheques.
- Processing Fee: Charges are based on the bank’s updated Schedule of Charges (SOC), which may vary.
2. Meezan Solar Financing
Meezan Bank offers a financing program called Meezan Solar. The solar on installment plan provides financing up to PKR 2.5 million, with a minimum one-year payback period and a maximum five-year repayment period. The annual profit rate, or interest rate, is 6%.
Three checks and your solar systems will serve as collateral. Since the permitted system capacity ranges from 1kW to 1MW, practically all home systems are included.
Pros of the Meezan Solar Program:
- Competitive interest rates and flexible repayment terms.
- Smooth and straightforward application process.
- Wide network of branches across Pakistan for easy application.
- Includes coverage for solar panels, inverters, wiring, mounting structure, etc.
- Shariah-compliant.
Cons of the Meezan Solar Program:
- Only available to homeowners.
- Relatively low maximum financing amount.
- Does not cover batteries or the cost of net metering.
3. Allied Bank Solar System Finance
Another solar financing program that Allied Bank offers to assist companies and individuals in achieving their renewable energy objectives is called ABL Solar Allied Bank Solar System Finance. You can repay up to PKR 3 million in borrowing from ABL over a maximum of 7 years. The standards of the SBP state that the interest rate is six percent annually.
Pros of Allied Solar Finance:
- Low minimum income requirement of PKR 50,000 per month.
- Convenient for existing ABL customers.
Cons of Allied Solar Finance:
- Not Shariah-compliant.
Final Thoughts
If you look at the different solar loan schemes discussed above, almost all of them offer the same terms and conditions. Some may offer more financing flexibility in terms of tenure—such as those that have repayment tenure of up to 7 years. If you have a bank account in banks mentioned above, you may consider financing your system through them.
Author: Freya Parker
I'm Freya Parker from Melbourne, Australia, and I love everything about cars. I studied at a great university in Melbourne and now work with companies like Melbourne Cash For Carz, Hobart Auto Removal, Local Cash For Cars Brisbane, Max Cash For Cars Brisbane and Car Removals Sydney. These companies buy all kinds of vehicles and help remove them responsibly. I'm really passionate about keeping the environment clean and like to talk about eco-friendly car solutions. I write in a simple and friendly way to help you understand more about buying and selling cars. I'm excited to share my knowledge and make car buying simpler for you.
