If you are looking for ways to make your business more eco-friendly, business car finance can be a useful tool for reducing your carbon footprint.
Nowadays, customers, investors and business partners are increasingly looking to affiliate themselves with businesses that demonstrate environmental consciousness. Therefore, in addition to the moral and financial benefits, it is in your best interest to find innovative ways to minimise your business’s impact on the environment.
Let us review how you can use business car finance to help you go green:
Transition to Electric or Hybrid Vehicles
While hybrid or electric vehicles no doubt offer lower operating costs, they are still quite a bit more expensive than traditional internal combustion engine vehicles. The sizeable pricetag can make them unattainable for many otherwise environmentally conscious individuals.
However, with a loan, you can acquire the capital you need to purchase a hybrid or electric vehicle.
What’s more, the Australian government has implemented an exemption from fringe benefits tax (FBT) for electric and hybrid vehicles that cost less than the current luxury car tax threshold, which is currently set at $89,332. Moreover, this threshold is set higher than the $76,950 threshold set for internal combustion engine vehicles.
According to the Electric Vehicle Council, this benefit could save you anywhere between $3,000 and $5,000 per year on your car payments.
Lower Operational Costs
When you factor in the potentially massive savings you will make on fuel costs, loans for electric or hybrid vehicles become significantly more affordable.
Although the cost of operating an electric vehicle will vary at any given time depending on fluctuations in the price of fuel and cost of electricity, it has been estimated that, on average, it would cost about 70% less to run than an internal combustion engine vehicle.
This means that 70% of the money that would otherwise have been spent on your fuel budget can be ploughed back into your vehicle loan.
Green Snowball Effect
Businesses that demonstrate environmentally conscious behaviour tend to find more favour with lenders and investors who want to affiliate themselves with green causes. This creates a reinforcing cycle of green funding, otherwise known as the green snowball effect.
Small Australian businesses that prioritise sustainability have preferential access to green financing options, government incentives, and growing consumer and investor demand for sustainable practices.
Larger companies with a strong green agenda gain access to things like green bonds, sustainability-linked loans and ESG funds.
In other words, investing in more sustainable vehicle options through a business car loan can set your business on the path to accessing an increasing array of sustainability-linked finance options.
iCREDIT is ready to help you find business car finance that works for you and helps your business become more climate conscious. For information, contact us now or apply online to get started.