FNB, yesterday, became the first commercial bank to enter into the Energy Bounce Back (EBB) Loan Guarantee Scheme to help customers mitigate the impact of power supply challenges.
However, the scheme is currently available for commercial customers for now and will soon be extended to individual FNB and non-FNB customers.
This comes as the National Treasury, last month, launched its long-awaited EBB Loan Guarantee Scheme, which allows households and small businesses to borrow from commercial banks a maximum of R300 000 and R10 million, respectively, to mitigate the impact of load shedding.
The scheme is designed to assist businesses and households through financial incentives for the installation of rooftop solar-generated energy and energy storage assets.
Treasury said participation in the EBB Loan Guarantee Scheme is facilitated through commercial banks on an opt-in basis.
FNB CEO Jacques Celliers said they were grateful for the opportunity to, once again, enable customers to invest in solar equipment via the scheme, as they did in the previous schemes.
“Energy security continues to be one of the key challenges for individual customers, families, and businesses. As a financial services partner, we want to help our customers meet their day-to-day requirements to enable them to thrive,” Celliers said.
“While we have been supporting our customers with a range of solutions to build resilience against energy challenges, we believe that the Energy Bounce Back Loan Scheme adds significant value, as it allows us to help many more.”
Participation in the scheme through commercial banks is subject to basic requirements, such as tax compliance and adherence to other legal and regulatory requirements.
FNB said commercial customers would be subjected to normal credit risk evaluation and processes for loans ranging from a minimum of R10 000 to a maximum of R10 million in order to qualify.
Any business with a maximum turnover of R300 million per annum can apply. No deposit is required, and customers can settle the loan early and pay no penalty fees.
Individual customers will apply for a personal loan at a personalised interest rate, but the interest rate will be lowered to prime +1%, fixed for the term of personal loan after proof of use is verified.
Individuals can take up a personal loan with a minimum of R3 000 up to R300 000, and at least 90% of the funds must be used for solar panels and related expenses such as batteries and inverters.
Celliers said they were encouraged by the progress made with Treasury and expected that FNB would soon be able to offer individual customers access to the Energy Bounce Back Loan before the end of the year; but business clients can access the offer immediately off the back of the first bounce back offering.
This comes as load shedding has intensified, once again, due to the necessary increase in generation planned maintenance and the recent multiple generation unit failures.
Eskom, on Sunday, ramped up rotational load shedding to Stage 5 after months in lower stages in a bid to recover emergency generation reserves after a generating unit at Duvha, Hendrina, Tutuka and two generating units at Kendal power stations were taken off-line for repairs.
South Africa’s economy has struggled to grow and make any significant dent in the high rate of unemployment in the country, mainly as a result of crippling power cuts.
Investec economist Lara Hodes yesterday said the second quarter gross domestic product was projected to remain muted, rising by a marginal 0.1%.
Hodes also said that business and consumer confidence for the third quarter of 2023 were expected to remain subdued due to the energy crisis.
“This is reflective of the fragile economic environment, which continues to be plagued by a number of challenges, predominantly inadequate electricity supply, with rotational load shedding a persistent feature. Indeed, load shedding has weighed heavily on economic activity, impeding production and trade,” Hodes said.
“Although we have seen an easing in the intensity of load shedding, it remains elevated, weighing heavily on business activity, elevating costs and eroding profits. Moreover, political uncertainty and the unfavourable domestic growth outlook continue to undermine sentiment.”
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