Green Car Loans

Reduce your carbon footprint and buy an environmentally friendly car with a green loan through Savvy.

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, updated on July 4th, 2023       

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Get a low rate with a green car loan through Savvy

“Greener” vehicles such as hybrid and electric cars are becoming more common in Australia as the country becomes increasingly conscious of its carbon footprint. As such, an increasing number of lenders are now offering specialised loan products designed specifically for these cars, known as green car loans.

If you’re in the market for your next car and are looking to buy a model which is better for the planet, a green car loan might be the best option for you to do so.

You can apply for your green loan right here with Savvy. We’re partnered with a range of lenders who offer this finance product, so we can help make the process of purchasing a green vehicle simpler and more cost-effective. Get the wheels in motion on your application by getting a quick online quote with us today.

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The features and benefits of green car loans

Lower interest rates

Green car loans come with a rate discount compared to standard car finance, enabling you to potentially save hundreds of dollars throughout your loan term, if not more.

Lower fees

It’s also common for lenders offering green loans to waive or lower other fees which may have otherwise applied to the finance agreement, boosting your savings further.

Flexible loan amounts

As is the case with any other car loan, you’ll be able to borrow up to 100% of the value of your vehicle or put forward as small or as large a deposit as you wish.

Repay over one to seven years

Additionally, you’re afforded the same flexibility as any other car loan in that you can choose to make your repayments over a term of between one and seven years.

Set your preferred payment schedule

On top of being able to select your chosen loan term, you’ll also choose whether to make your repayments on a weekly, fortnightly or monthly basis.

Help the planet

By purchasing a hybrid or electric model with a green car loan, you’ll be playing your part in helping the planet by reducing your environmental impact.

Why Australians take out green car loans through Savvy

The pros and cons of green car loans


Discount on interest rate and fees

The main benefit offered by green car finance is the discount available to vehicle buyers, which comes in the form of both reduced rates and reduced or waived fees.

Lower costs may enable more expensive purchase

With the overall cost of green loans being lower than standard car loans, you’ll spend less on interest and fees, which frees up funds for a more expensive model.

Same loan structure as standard car loans

These are effectively the same product as a car loan, meaning there aren’t any major structural differences which applicants will need to wrap their head around.


Criteria differs between lenders

What constitutes a green car and the other eligibility criteria for vehicles which fit under this product can vary between lenders, so it’s important to apply with Savvy.

Fewer options available for used green cars

Green car loans are designed to incentivise the purchase of the latest environmentally friendly vehicle technology, making it more difficult to purchase a used car.

Not available with all lenders

Additionally, green loans aren’t offered by every lender, meaning you won’t have as many options to choose from compared to standard car loans.

Green car loans explained further

What are green car loans and how do they work?

Green car loans are a type of secured car finance in Australia designed for individuals looking to purchase a car which is considered to be green; that is, one which is more environmentally friendly. What makes these loans notable is the decrease in interest rates and fees on offer, which makes them one of the best ways to finance a car with low or no emissions. Only a select range of vehicles will qualify for this type of loan as a result, with the criteria in place regarding which cars can be purchased generally being stricter than most car loans.

Aside from this, the product is essentially the same as any other car loan in terms of its structure. You can borrow a similar amount (up to 100% of your vehicle’s value or your maximum borrowing power) and take between one and seven years to repay your loan debt. You can get a quote with Savvy today and speak with one of our dedicated consultants about the most affordable options available to you for your green vehicle purchase.

Which vehicles can be purchased with a green car loan in Australia?

The exact makes and models which can be purchased under a green finance deal will vary depending on the lender and their criteria. As such, it’s important to speak with your Savvy consultant to see whether the vehicle you’re looking to buy qualifies for a green loan. However, the general vehicle types which green loans can help you buy can include the following:

  • Hybrid vehicles: operating on a combination of electricity and petrol, hybrid vehicles are another alternative to pure petrol cars which are eligible to be purchased under a green car loan.
  • Electric vehicles: a new and increasingly popular innovation on the market, electric vehicle loans are 100% petrol-free and are considered to be the most environmentally friendly type of car.
  • Low-emission petrol-based vehicles: green loans aren’t just for cars which partially or entirely run on electricity, as some lenders offering these products will also allow the purchase of models which are classed as producing low emissions.

How should I compare green car loans?

There are several key areas in which to compare green car loans, with some of the most important being the following:

  • Interest rates: the minimum rates offered are very important to consider, as these will form the most substantial cost of your car loan. Even small differences of 0.5% p.a. (which is often the discount applied to these loans) can save you hundreds of dollars overall.
  • Fees: additionally, as mentioned, many green car loans will either reduce fees or waive them entirely. This can include establishment fees (up to $600) and ongoing fees (up to $20 per month), so these are crucial to consider.
  • Vehicle eligibility: of course, it’s crucial to make sure the car you’re buying qualifies for finance with different lenders, so this is a simple way to compare and narrow down your options.
  • Available terms: while some lenders will offer the full range of terms from one to seven years, others may limit you to a minimum of three and/or a maximum of five, so it’s crucial to ensure you find a term which suits your needs.
  • Applicant eligibility: on top of ensuring your vehicle is eligible, it’s crucial to narrow down your options to include only those which can accept your application. Factors include age, residency, employment, income and credit history.

When applying with Savvy, however, your consultant will do all the heavy lifting and car loan comparisons for you. They’ll keep your preferences and situation front of mind when comparing offers to find the best one for your needs, seeking out the most affordable deal and only considering those for which you and your vehicle are eligible.

More common green loan questions answered

Are there any other costs to think about when purchasing a green car?

Yes – as is the case with all cars, you’ll have to budget for costs such as stamp duty, vehicle registration, comprehensive car insurance and other on-road costs. If you’re buying an electric vehicle, you’ll also have to consider a charging station in your home to ensure it remains charged when you need it.

Do I have to take out a green loan when buying a green car?

No – electric and hybrid vehicles can still be purchased with a standard car loan, which may be required if they don’t otherwise meet the eligibility criteria set in place by your lender. You might also find that in some cases, the standard rate offered by one lender may be lower than the green car loan rate offered by another, so it may be your best option. Apply with Savvy and your consultant will help you find the most suitable car loan for your vehicle purchase with the lowest rate.

Will I be able to repay my green loan ahead of schedule?

Yes – we’re partnered with lenders who allow additional payments towards your car loan free of charge. However, you’ll generally have to pay a fee for completing your loan payments early, which will vary in cost depending on your lender, the size of your loan and the time left to run on the agreement when you pay it out.

Will my interest be fixed or variable?

Secured car loans come with fixed interest rates, meaning you’ll know for certain what you’ll be paying each month and over the course of your agreement should you stick to your schedule. Variable interest rates are typically only available on unsecured loans.

Can I take out a green loan for a commercial vehicle purchase?

Yes – there are lenders amongst our partners who can offer business operators purchasing green vehicles for commercial purposes a discount on rates and fees. As such, you can still take advantage of this benefit even when buying on behalf of your business.

How can I work out the cost of my green car loan?

Working out the cost of your car loan is simple when using Savvy’s car loan calculator. This gives you an indication of what your loan will cost each week, fortnight or month and overall based on the size, length and rate, as well as a deposit if you wish to offer one. Using this calculator before diving into the application process can give you a better understanding of what different loans will cost both in the short and long-term.

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