A major Australian bank has announced it will stop offering loans for new petrol and diesel cars as part of an aggressive approach to combating climate change.
Bank Australia says it will stop financing new fossil fuel vehicles from 2025, although it will continue to offer customers financing for second-hand petrol and diesel cars.
“By ceasing car loans for new fossil fuel vehicles, we are sending a signal to the Australian market about the rapid acceleration in the transition from internal combustion vehicles to electric vehicles that we expect to see in the coming years,” said Sasha, director of bank impact. Courville said.
The bank made the announcements at the National Electric Vehicle Summit in Canberra and defended introducing the policy in just over two years, saying urgent action was needed to keep global temperature rise below 1.5 degrees.
“We chose 2025 because the shift to electric vehicles needs to happen quickly, and we believe it may be possible with the right supporting policies to bring a wider range of more affordable electric vehicles to Australia,” said Ms Courville.
The Victoria-based bank, formerly known as Bankmecu, has for the past four years offered lower interest rates for low-emission vehicles, runs its operations on 100% renewable energy, and earlier this year set a target of zero net emissions by 2034.
A combination of factors has kept Australian drivers out of the EV market, including the availability of charging stations, long waiting lists and high prices compared to petrol vehicles.
But Ms Courville said Bank Australia wanted to send a message to the market that customers should think about buying an electric vehicle, but would continue to offer loans for second-hand fossil fuel cars.
“We are very conscious that we must support people who cannot yet afford an electric vehicle while the market grows,” said Ms Courville.
“We will continue to offer loans for second-hand fossil fuel vehicles until there is a viable and thriving market for electric vehicles.”