Two S’pore banks seek slice of electric vehicle pie, Transport News & Top Stories

Financial institutions here are starting to jump on the green vehicle bandwagon, with at least two entering ventures related to electric cars.

When American electric carmaker Tesla’s Singapore sales portal went live last week, it emerged that the company had roped in DBS Bank as its preferred partner for loans.

A Tesla Singapore webpage cited zero down payment and an effective interest rate of 3.2 per cent.

This raised eyebrows because it appeared to breach a Monetary Authority of Singapore (MAS) directive restricting car loans to no more than 70 per cent of the vehicle sale price.

When contacted yesterday, a DBS spokesman said loans to Tesla buyers would follow MAS guidelines, and that Tesla was “in the midst of changing that” on its website.

In a separate statement yesterday, DBS said it was tapping what it considered to be a growth segment – loans for green cars.

The bank said the interest rate for its green car loan is “currently the lowest in the industry… to encourage car owners in Singapore to reduce their carbon footprint”. DBS’ effective interest rate for non-electrified cars is 0.57 point higher at 3.77 per cent.

The loan will be available from March 1, and applies to the purchase of new and used electric and hybrid vehicles.

DBS added that it will make a donation towards tree planting in the National Parks Board’s One Million Trees movement for each customer who takes up the new loan.

Meanwhile, OCBC Bank has partnered Charge+ – a provider of electric vehicle (EV) charging infrastructure – to “accelerate the greening of Singapore’s land transport sector”.

The two have signed a memorandum of understanding and OCBC will “leverage its extensive coverage of the real estate sector to encourage its property-developer and property-owner customers to install charging points on their premises”.

In addition, the two parties will develop incentives to encourage OCBC customers to purchase electric vehicles and charge them at Charge+ charging points, the bank said in a statement yesterday.

Asked what financial gains it hopes will come out of this tie-up, an OCBC spokesman said the bank will help finance the roll-out of EV charging points, and this will have “interest and fees associated with them”.

“By getting into the ecosystem, we also hope to be able to provide the same kind of banking support to other companies that join the ecosystem in the future,” the spokesman added.

The move is in line with OCBC’s aim to build a $25 billion sustainable finance portfolio by 2025 – a target that was announced in June last year.

Charge+ plans to erect 10,000 EV charging points islandwide by 2030. It has identified condominiums as suitable locations for such points.

When contacted, leading car loan provider Hong Leong Finance would say only that it is in talks with Tesla to offer “competitive loan packages”.