Small to medium-sized businesses (SMB) are increasingly tapping into sustainable finance to fund new equipment in ways that can save the environment and produce healthier bottom lines.
What is sustainable financing?
Sustainable finance is any financial product that looks beyond the bottom line to wider environmental, social or governance concerns. It typically includes funding for energy-efficient products such as solar panels or green-friendly vehicles like electric cars or hybrids. The focus is on investing in growth, or upgrading assets that contributes towards a more sustainable future.
It is a growing arm of financial services. One estimate puts “socially responsible investments” at $23 trillion or 26 per cent of funds under management globally, and in Australia, major lending institutions are beginning to realign their values with a more ecological and socially sustainable economic future.
Why SMBs should consider sustainable finance
All of this is great news for SMBs who want to pitch in and do their bit for the environment, by investing in environmentally friendly equipment and technology.
The move to sustainable models of finance has been led by large corporates through issuing so-called ‘green’ corporate bonds and by the federal government, who tipped in $10 billion to establish the Clean Energy Finance Corporation (CEFC) in 2012, making sustainable finance more accessible for SMBs.
Benefits of sustainable finance
Lower interest rates for one. Financing companies are working together with the government led CEFC, to provide SMBS with discounted finance rates on eligible equipment.
That means SMBs who want to, for example, invest in rooftop solar panels, agricultural equipment, or heavy machinery can apply for sustainable finance at more affordable rates.
Other benefits include reduced power bills as a result of more energy efficient equipment, reduced carbon emissions and contributing towards building more sustainable operations.
What can a SMB apply for?
Whether you are in the office, on the farm or own a factory, your choice of new equipment could potentially qualify for sustainable finance.
Some examples of eligible equipment include rooftop solar panels, solar thermal for hot water and heat pumps, more energy-efficient air conditioning, refrigeration equipment, or electric and plug-in hybrid electric vehicles.
Talk to us today to understand how your business could take the first step towards greener energy.
Original post by Bank of Queensland