New Canstar Award recognises green products helping consumers and the environment

Canstar has announced the winners of its first ever Green Excellence Award, recognising the financial products and services in Australia making a positive impact on the environment and consumers.

The new Award celebrates excellence in an area of the financial services industry that has seen significant growth in recent years, as banks and other financial product providers innovate, both in response to changing consumer needs and to incentivise further behaviour change among consumers.

A series of extreme weather events across Australia over the last few years and record-high fuel prices in 2022 have likely made transitioning to greener products and services more of a priority for many consumers. An upcoming federal election with climate change featuring as a big policy issue in many constituencies also shines a (solar-powered) spotlight on this area.

For their part, many banks, non-bank lenders and other financial institutions have responded by introducing new green products, including green loans. Many of these offer preferential rates and other incentives to consumers who borrow money to purchase an environmentally-friendly vehicle or make a green upgrade to their home, such as adding solar panels or a solar hot water system.

“Our Green Excellence Award recognises the initiatives that are increasing the accessibility of sustainable products and services for Australians, and in their own way are setting a new green benchmark,” said Canstar’s General Manager, Research & Insights, Mitch Watson.

“The growing consumer demand and importance of providing sustainable products is reflected in the investment made by providers in the range of products and initiatives that were submitted for the Award. It is particularly encouraging to see green initiatives across a broad spectrum of industries and areas,” he said.

Canstar’s Green Excellence Award has been launched alongside Canstar Blue’s Green Excellence Award, which recognises providers in the energy and telco industries.

Canstar’s Green Excellence Award Winners for 2022

The following providers, listed alphabetically, are the inaugural recipients of Canstar’s Green Excellence Award for 2022, based on the environmental impact and consumer empowerment delivered by green products they have introduced to the market.

Pepper Money – Electric Vehicle Loan

Pepper Money’s Electric Vehicle Loan offers a low interest rate for borrowers who purchase an electric vehicle (EV). Pepper Money also provides borrowers with a number of additional services, to support them during their journey as an EV owner.

According to Canstar’s judging panel, Pepper Money impressed across the board, particularly in the consumer empowerment criterion, thanks to a number of initiatives including free public EV charging for up to 12,000 km over the course of a year.

Pepper Money also partners with a car disposal service, to make it more straightforward for a borrower to sell their existing car. This service then extends to helping the borrower find and buy a new EV, including organising delivery of the vehicle.

“Pepper Money is enabling consumers to purchase green by reducing some key barriers to EV ownership,” Canstar’s judges said.

According to Pepper Money, a report by the Electric Vehicle Council found that the 3,053 EV purchases the lender has financed since 2015 have helped reduce borrowers’ combined carbon emissions by more than 3,800 tonnes. The lender says that in 2022, its target is a 60% increase in EV financing, to help more Australians to access EVs.

Key features and costs of Pepper Money’s Electric Vehicle Loan

• Borrow up to $300,000 for the purchase of any brand of new, used or demo EV.
• No deposit required, meaning borrowers can borrow 100% of the vehicle’s value.
• Interest rate of 3.99% (comparison rate 3.99%).
• Loan term of between one and seven years.
• $6 security registration fee.
• No other upfront, ongoing, early repayment or discharge fees.

RACQ Bank – Green Home Loan

RACQ Bank’s Green Home Loan enables the lender’s eligible existing home loan customers to borrow additional funds at a greatly reduced interest rate to fund environmentally friendly additions to their home. The loans of up to $50,000 can be used to install solar panels, battery packs, a solar hot water system, a heat pump hot water system, or an EV charging station.

Canstar’s judging panel noted the lender’s “market-leading” interest rate of 0.79% (comparison rate 0.79%), saying it “empowers consumers to utilise the product and access sustainable features at a very affordable rate.”

The judges also praised RACQ’s condition that installers and suppliers of the sustainability features funded by the loan must be approved by the Clean Energy Council, to ensure members are paying a fair price for a certified quality product.

According to RACQ, a survey it carried out found 75% of Queenslanders had made efforts to reduce electricity consumption, and 44% were interested in a specific loan to make sustainable improvements to their home. It says its Green Home Loan makes that sustainability more affordable for its customers.

While it is based in Queensland, RACQ’s home loans are available to eligible Australian citizens and permanent residents regardless of which state or territory they live in.

Key features and costs of RACQ Green Home Loan

• Borrow between $3,000 and $50,000 for eligible green home improvements.
• Applicants must have an existing home loan with RACQ with a minimum balance of $250,000 to be eligible.
• Interest rate of 0.79% (comparison rate 0.79%) applies to the new funds borrowed under the Green Home Loan.
• The maximum loan term is 10 years if the loan amount is less than $20,000, or 15 years for loans of $20,000 to $50,000.
• Borrowers can make unlimited repayments and repay early with no penalty.
• No monthly account-keeping or ongoing administration fees apply.

How were Canstar’s Green Excellence Awards assessed?

Submissions for the Green Excellence Award were assessed by a panel of judges against two overarching criteria: Environmental Impact and Consumer Empowerment.

Environmental Impact considers the extent to which the product, service or initiative creates a positive impact on the environment or society. Within this category, the judges looked at the product, service or initiative’s sustainability strategy, targets and performance, as well as the business’ commitment to driving sustainable change.

Consumer Empowerment considers how effective the product, service or initiative is at empowering consumers to be the ‘directors of their own lives’ by driving consumer behaviour change or enabling consumers to choose more sustainable options. To determine this, the judges considered the accessibility of the product, service or initiative, as well as how consumers use or engage with the product, including how affordable and easy-to-use it is.

The Award was open to entries based on a range of financial and insurance products, including lending products, online banking products, payment technology, wealth products, general insurance products, investing services and products, deposit accounts, and business banking products and services.

For more details, you can read Canstar’s Green Excellence Awards methodology. You can also read more about Canstar Blue’s Green Excellence Award-winning providers. 

Cover image source: husjur02/Shutterstock.com