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How do Green Loans work

21 November 2023
• 4 minute read
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As the need for environmental action becomes ever more apparent, governments and corporations are increasingly incentivising the public to think and act more sustainably. One way to do this is via green loans, which can help you save money while also reducing your emissions. Sounds like a win-win, right?

In this article, we look at exactly what makes a loan ‘green’, the various ways in which one can save you money, the different types offered by Great Southern Bank, and more.

What is a green loan?

What’s the difference between a green loan and a personal loan? The main one is that a green loan must be used to fund ‘green’ (i.e., environmentally-friendly) purchases such as hybrid or electric vehicles, solar panels, or battery packs. But that’s not all. Green loans can also save you money in a number of different ways. Let’s explore them now.

How can a green loan save you money?

One way in which a green loan can save you money is by financing products which can cut your energy bills. So although something like installing solar panels requires an initial outlay (which is what you’d typically need the loan for), research suggests the average system would pay for itself within four to eight years.

Another financial bonus for this sort of home-improvement purchase is that it’s likely to add value to your property.

Similarly, while electric vehicles are more expensive to buy, they are significantly cheaper to run, with newly-released data revealing that they’ll save you between $1320 and $3070 on average per year compared to petrol, diesel and hybrid-powered cars.

It’s also worth mentioning that every state and territory in Australia offers an incentive for purchasing an electric vehicle. These incentives can include rebates, charging subsidies and discounts on registration and stamp duty. To find out if you're eligible, check with your relevant state government department.

Green loans vs personal loans

At this point you might be thinking, “Well, that’s all great but why wouldn’t I just get a normal personal loan?” The answer is that a green loan is itself cheaper than a standard personal loan. If you take a look at our personal loans comparison page, you’ll see the interest rates for our two green loan products, namely the Green Car Loan and Unsecured Green Personal Loan, are lower than for their non-green counterparts.

Great Southern Bank Green Loans

Seeing as we’ve just mentioned them, let’s take a look at Great Southern Bank’s two green loan products in a bit more detail.

Green Car Loan

A Great Southern Bank Green Car Loan is a secured loan for the purchase of a low or no-emission electric or hybrid engine vehicle. To be eligible, the car in question must have either an electric or hybrid engine and be listed on the Green Vehicle Guide.

A Green Car Loan may also be used to buy a home-charging station with a 'single-phase' or 'three-phase' dedicated wall box as long as it’s purchased at the same time as the vehicle and installed by an accredited installer.

Unsecured Green Personal Loan

A Great Southern Bank Unsecured Green Personal Loan can be used to buy a small range of items which can lessen your home’s carbon footprint and lower your energy bills.

These are:

Why choose a Great Southern Bank Green Loan?

As we’ve seen, there are plenty of reasons to choose a green loan. If helping to reduce your emissions while saving yourself money doesn’t sound like a sweet deal, we’re not sure what does. But not all green loans are created equal. As with any kind of personal loan, it’s important to pay attention to more than just the interest rate.

Here are some reasons to choose a Great Southern Bank Green Loan:

  • Personalised interest rate
    A personalised interest rate is based on an assessment of your personal circumstances and credit score. If you have an excellent credit score and a good history of repaying loans, credit cards and other bills, you’ll likely be offered a lower interest rate. Find out more here.
  • $0 monthly or annual fees
    Why pay additional fees simply for having a loan? With us, you don’t have to!
  • Unlimited extra repayments
    Make as many extra repayments as you like and pay your loan off sooner.
  • No penalties for early payout
    There is no penalty fee for paying your loan off before the end of its term.

Ready to go green?

If you’re ready to apply for a Great Southern Bank Green Car Loan or a Great Southern Bank Unsecured Green Personal Loan, you can do so quickly and easily online. You must be over the age of 18, a permanent resident of Australia, and receive a regular income.

In order to a complete the online application process, you will need:

  • Proof of Identity (such as a driver’s licence).
  • Employment and income details (such as a payslip).
  • Expenses and debt details.

But if you’d rather speak to someone first, that’s fine too. Simply give us a call on 133 282 and one of our friendly team will be happy to help. Alternatively, you can always pop into your local branch for a chat.

Important Information

Great Southern Bank, a business name of Credit Union Australia Ltd ABN 44 087 650 959, AFSL and Australian Credit Licence Number 238317. Conditions, fees and charges apply. This is general information and does not take into account your objectives, financial situation or needs. Consider the appropriateness of the information, including the Terms and Conditions (T&Cs) booklet, before acting on it. The Financial Claims Scheme may apply to this product; refer to the T&Cs for more information.

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