The interest rate for qualifying green vehicles is 5.3 per cent per annum for five-year loans, compared to 6.0 per cent per annum for standard vehicles.
For a $50,000 green vehicle loan, customers will pay $7,026.96 in interest over the five-year term of the loan, which is $971.44 lower than the $7,998.40 in interest that customers would have to pay for a regular vehicle loan.
Resulting from a partnership between Firstmac and the Clean Energy Finance Corporation, Firstmac managing director Kim Cannon said that the preferential rate is expected to encourage the purchase of electric vehicles.
“Electric cars are an increasingly attractive proposition for users with [their] longer battery range and improved features, but they still don’t quite match petrol vehicles on upfront cost,” Mr Cannon said.
“Our green car discount will help to close the gap so people can choose to help the environment and save money at the same time.”
Electric vehicles that are available or scheduled for release in Australia this year include the Tesla Model 3, the Nissan LEAF, the BMW i3 and the Hyundai Ioniq, among others.
Firstmac said that for vehicles to qualify, they need to have “significantly lower than average carbon dioxide emissions” compared to other similar-sized cars.
All hybrid and electric vehicles qualify for the green loan discount, as well as a number of low-emission petrol vehicles, according to the non-bank lender.
Vehicles on the approved list include some models of the Mazda 3, the Ford Fiesta, the Honda Jazz and the Volkswagen Golf, as well as some vehicles from Mercedes, Audi and BMW.
[Related: NAB launches green mortgage-backed bond]
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Tas Bindi is the features editor on the mortgage titles and writes about the mortgage industry, macroeconomics, fintech, financial regulation, and market trends.
Prior to joining Momentum Media, Tas wrote for business and technology titles such as ZDNet, TechRepublic, Startup Daily, and Dynamic Business.