First ‘big four’ bank launches electrified car loan
Westpac has just launched a new loan for hybrids and EVs, but there are deals out there for those willing to look.
One of Australia’s ‘big four’ banks has announced a new financial product for low-emissions vehicles.
Westpac is the first big bank to launch a Hybrid and Electric Car Loan, offering favourable rates for those wanting to make the move to an electrified vehicle.
The bank said the new loan was designed to help Australians who are looking to move away from traditional petrol and diesel cars, particularly in the current climate of soaring fuel prices.
“This is aimed at supporting [electric vehicle] and hybrid growth, but it’s also part of a much broader plan by the bank to help Australia reduce carbon emissions,” said Steve Rubenstein, managing director of consumer finance at Westpac.
In a survey conducted by the bank, it found 78 per cent of respondents wanted an electric vehicle (EV) to save on fuel costs, 69 per cent wanted lower running costs overall, and 60 per cent wanted to reduce carbon emissions.
However, while Westpac is offering an annual fixed rate of up to 4.99 per cent for up to seven years, the comparison rate – the government-mandated rate which includes all the fees and charges associated with the loan – comes in at a much higher 6.21 per cent per annum.
While so-called ‘green car loans’ are still fairly new to the market, Macquarie Bank appears to offer one of the best finance for pure-electric cars with an interest rate from 3.99 per cent per annum – and with a comparison rate to match.
Pepper Money also offers a 3.99 per cent fixed interest and comparison rate for electric cars, claiming to be responsible for financing one in every nine EVs sold in Australia, and winning Canstar’s ‘Green Excellence for Electric Vehicle Loans’ award in 2022.
The difference between the Westpac loan and the Macquarie or Pepper loan could add up to thousands of dollars over the life of the term for someone wanting to buy a vehicle like a Tesla Model 3.
Another good deal at the time of writing comes from Driva, with a fixed rate of 3.49 per cent and comparison rate of 4.19 per annum for those with good credit looking to buy a battery-powered car.
Loans.com.au also has a favourable deal, offering a variable rate of 3.14 per cent with a comparison rate of 3.68 per cent – however this is expected to rise as the Reserve Bank of Australia increases the cash rate.
Bank Australia offers a Low Emissions Vehicle Car Loan for hybrids and EVs, with a fixed interest rate of 5.45 per cent and a matched comparison rate, while RACQ Bank has a similar product for Queenslanders at 5.59 per cent.
Before making any decisions, it’s strongly recommended to speak with a financial advisor to find out which product would suit your circumstances best.
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