Solar technology has grown by leap and bounds over the past decade. Switching to Solar Energy is a significant step towards environmental protection and preservation.It is also a very attractive proposition given the rising prices of electricity. However, this decision may not be easy given the high upfront investment required to install the system at your home, place of business or your factory. A typical 5kW on-grid solar energy system (without batteries) can cost a customer Rs.500,000 and above which can be steep for many interested potential customers. Cost of hybrid solar systems are even higher. Thankfully, the solar industry has grown and a number of Banks are now bridging this gap by providing solar financing products.
Energy policy of Pakistan has laid out ambitious plans of increasing contribution of renewable energy in the country total energy mix. State Bank in its efforts to reach these goalshas offered a concessional financing arrangement for end consumer. A number of reputable Banks in Pakistan including Bank Al Falah, Meezan Bank and JS Bank are now offering solar financing at a rate of 6%. This facility is extremely attractive for end customer as the amount of monthly installment is less than the savings, they make in reducing their electricity bills with the solar installation. Financing is available to all sectors including residential, commercial and industrial. Banks are lending to salaried, business owners as well as pensioners. Eligibility criteria and other terms and conditions are in line with other consumer financing products.
All banks carry out due diligence process to approve financing. Credit bureau and debt burden checks as well as address and business verification processes are carried out by most banks. Similarly, some banks do not provide financing for batteries and net metering applications. It is important to check all terms and conditions with your financing bank as they may vary bank to bank. There is a lot to consider when making the decision. Whilst upfront investment may seem dauting, longer term benefits in terms of electricity bill savings, increase in property value and contribution to cleaner energy outweighs the initial cost implication.