Major New Zealand bank offering interest-free loans for electric vehicles

A major New Zealand bank is offering interest-free loans for up to five years to help Kiwis buy electric vehicles. 

Westpac announced the new loans on Tuesday as part of its "sustainable lending programme".

It's available to anyone with a Westpac home loan who meets lending and affordability criteria. 

Westpac NZ general manager of product, sustainability and marketing Sarah Hearn said the new loans are part of a programme helping Kiwis lower their carbon footprints. 

"We've already lent $80 million to customers on a range of items to make their home more energy efficient, such as heat pumps, insulation, ventilation, solar panels and double glazing.

"Now customers can also use the loan to purchase EVs of any kind, which could help cut their carbon footprint and save them money in the long term."

The loans can be used on either a new or second-hand EV that was purchased through a dealership. 

Hearn said Westpac has also expanded the lending limit from $40,000 to $50,000 to "accommodate more purchasing options". 

"There are no establishment fees and we structure the loan to be fully paid off after the five-year interest-free period.

"We launched this product internally last month and initial feedback has been positive, with strong appetite both from new and existing customers."

Rainwater tanks and hot water heat pumps are also newly eligible for the loan.

Hearn said Westpac's 'greater choices' lending target is doubling to $200 million.

"The $80 million we've already lent is enough to purchase about 32,000 heat pumps or insulate more than 26,000 homes - the equivalent of an entire small city living in greater comfort and saving on power bills."

Westpac is currently the only bank with interest-free loans for EVs. However, both ANZ and ASB offer loans of up to $80,000 at 1 percent interest for three years for EVs and energy-saving home upgrades. 

The Government is also incentivising Kiwis to buy EVs through its Clean Car Discount programme, which pays a subsidy to buyers of low-emission vehicles by charging a fee for heavy polluters.