Sagicor Bank designs loan for renewable energy projects
Sagicor Bank Jamaica has created a new loan facility to power renewable energy projects for residential and commercial use.
The loan is offered at an annual interest rate of 9.5 per cent calculated on the reducing balance, and has a repayment period of up to seven years.
The facility is designed to offer up to 80 per cent financing for residential renewable energy projects valued up to $2 million, and covers up to 70 per cent of the cost for commercial projects valued up to $30 million.
"Sagicor Bank recognises the needs of our customer base and continuously tries to design products to meet those needs," business banker at Sagicor Bank, Cornella Alladice, told the Jamaica Observer.
This renewable energy facility is the first of its kind for the bank and can be applied to a number of products, including the SolarMill Star units, solar water heaters, solar panels, and other energy-saving equipment.
"The negative effects of high energy cost on the competitiveness and cash flows of our business clients were observed. We... recognised that lower energy cost would free up cash flows for debt servicing," Alladice added in her e-mailed response to Sunday Finance queries.
While she was not able to quantify the take-up on this loan facility, Alladice said, "Several clients have benefited and we continue to receive inquiries from among our existing client base" as well as from people who are not the bank's customers.
In order to be able to access the loan, residential applicants must provide a job letter and their last three pay slips as proof of income, confirmation of existing liabilities and assets, a copy of their residential energy audit or invoice along with a 12-month billing history from the Jamaica Public Service (JPS).
Commercial applicants must furnish the bank with the last three years of the company's audited financials, year-to-date in-house management accounts, cash flow projections for at least the next 12 months, as well as a copy of the company's energy audits, aged receivables and 12-month billing history from the JPS.
Access to the loan facility is also contingent on applicants meeting the security requirements of a first or second mortgage over residential property, a lien over existing energy-efficient equipment or the alternative energy system being financed, the creditor's life insurance as well as assignment over the peril insurance over the property or equipment.