Hong Leong floats green vehicle financing for Singapore vehicle rental firms

The Vehicle-Green Loan offers a rate as low as 1.5% per annum.

Hong Leong Finance has launched a green vehicle financing initiative for vehicle rental companies, touted by the banks as the first in Singapore.

In a press release, HLF revealed that the initiative comes in two parts: a Vehicle-Green Loan for fully electric vehicles (EVs) and hybrid vehicles, and a Charger-Green Loan for companies to take up charging station financing.

The Vehicle-Green Loan offers a rate as low as 1.5% per annum for up to seven years, and is available for purchase of full EVs or hybrid vehicles, the latter a combination of a petrol engine with an electric motor.

Companies also have the opportunity to take up charging station financing as a compatible option under the Charger-Green Loan scheme up to three years.  

Financing for both the EV and charger will be offered together to the rental companies, whilst they can decide on the make and brand of the EVs as well as the charging stations.  

HLF expects that its initiative will help to accelerate the number of charging stations to 60,000 under the Singapore Green Plan 2030, enhance drivers’ convenience with more charging locations islandwide, and reduce the waiting time to charge the car.

The Charger-Green Loan scheme will be expanded progressively to finance charger stations at commercial buildings and private condominiums, the bank added.

“In addition to customers who buy cars for personal use, we note that the vehicle rental category which includes private hire cars is a significant growing sector,” said Ang Tong Chor, president of Hong Leong Finance.

“We want to be inclusive. With the government’s enhanced rebates on green cars in place, these companies will benefit as early adopters of eco-friendly vehicles,” he added.

Data from the Land Transport Authority revealed that Singapore’s private hire car sector grew 142% over the last five years to 71,147 cars in 2020. Over the same period, the number of EVs and hybrids on the island grew 571% to 43,632 vehicles.  

Similarly, the private car hire industry is seeing an increase in EVs. For example, Grab added 200 EVs to its fleet in 2019, indicating the growing ride-hailing market here and the cost efficiencies to these drivers, noted HLF.

Photo courtesy of Tesla