Driving Sustainability: The Impact of Green Loans on Electric Vehicle Adoption
By Avinash Bansode, Head BNPL, CASHe
As we advance into a future defined by innovation and sustainability, the pressure on our infrastructure and natural resources intensifies. In response, global governments are championing electric vehicles (EVs) as a cornerstone of sustainable transportation. Transportation is fundamental in our modern lives, accounting for most human movement. However, traditional vehicles powered by petrol or diesel contribute significantly to pollution and resource depletion. Electric vehicles, offering zero emissions, present a pivotal solution for a sustainable future. Embracing EVs is not merely an option; it is necessary to ensure future generations’ well-being.
By 2023, there were registrations for more than 250000 new cases for one week alone; India also looks forward to reducing import duty on specific EVs from countries whose companies could promise to invest at least $500 million and start manufacturing facilities within three years’ time period. Moreover, this policy also intends to appeal to big players such as Tesla so that it can be seen that it has an interest in foreign direct investment. According to the projection of 2050, there are expected to be one billion electric vehicles on streets worldwide. The sales of electric vehicles (EVs) increased in India during May 2024 compared with April 2024 for most categories. E-rickshaws (from 32K to 40K approx. units), Electric Two-Wheelers (E2W) (66K to 77k units) and E3W L5 Pax (from 4300 to 7500 units).
Category-wise electric vehicle sales in 2024
Total registered electric vehicle “APRIL-24 116000 MAY- 140000”
National Incentives
The growth and adoption of EVs in India is propelled by multiple governmental factors.
India’s flagship initiative, the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles (FAME), is currently in its second phase, FAME-2. This phase concluded in March 2024 and is transitioning to FAME-3, which will continue supporting electric two-wheelers and three-wheelers. FAME-3, expected to extend incentives to electric cars under ₹15 lakh and potentially hybrid cars, aims to amplify EV adoption. The scheme promises substantial support for electric buses, backed by a robust budget allocation. Moreover, tax benefits, like those under Section 80EEB in India, provide substantial savings on interest paid for EV loans.
How Green Loan Can Accelerate Growth
Green finance is transforming the landscape for economic and environmental benefits, paving the way for a low-carbon society while fostering socially inclusive growth. Among the various instruments of green finance, green loans stand out as a tailored solution to fund environmentally beneficial projects. This article explores how green loans can significantly drive the expansion of electric vehicles (EVs).
The Need for Green Finance in EV Adoption
According to a recent report by NITI Aayog, India’s transition to electric vehicles will require an estimated investment of approximately Rs 2000 crore over the next decade. This substantial investment covers the development of charging and swapping stations, the establishment of manufacturing plants, and incentives for individuals switching from traditional vehicles to EVs.
Green loans are instrumental in accelerating the adoption of electric vehicles. They offer reduced interest rates and better terms than standard loans, often subsidized by governments or backed by financial institutions committed to sustainable development. By lowering borrowing costs, green loans make electric vehicles more accessible to a broader range of people. The availability of green loans raises awareness about the environmental benefits of EVs and the financial mechanisms supporting their purchase. This awareness can shift consumer perceptions, making EVs a more attractive option in the market. Moreover, the funding from green loans can be directed towards building the necessary infrastructure for EVs, such as charging stations and manufacturing plants, thereby supporting the growth of the EV market.
In conclusion, green finance is a transformative force, and green loans are essential in advancing the future of electric vehicles. As we progress towards a more sustainable world, the importance of green loans in fostering eco-friendly products and services becomes increasingly evident. By supporting the expansion of electric vehicles, green loans are paving the way for a cleaner, greener, and more inclusive planet. Experience swift and affordable electric 2-wheeler financing with CASHe Green, your reliable funding partner. Embrace the eco-friendly movement and enjoy the simplicity of ownership through cost-effective financial solutions. Trust us for your journey towards sustainable living as we pave the way for a greener tomorrow.
