They say it’s good to dream big. But how can you make those dreams come true when it comes to buying a top of the range electric car?
The wealthiest among us can stroll into their local dealership and simply buy a chosen model outright. Nice. But for the rest of us, we’re stuck with a choice between leasing or taking out some kind of loan to pay for that dream car.
So what are some of the financing options available at the moment in the UAE?
EV finance from banks
Banks in the UAE are generally supportive of the move to electrification and The good news is that quite a lot of UAE banks offer loans or deals specifically for the purchase of electric or hybrid cars.
But remember, they have just one job – to make money from you. They are certainly not in the business of giving something for nothing and it really pays to shop around for the right deal. Here are some of the options.
EMIRATES NBD
Emirates NBD was one of the first banks in the UAE to announce eco-friendly car loans, the Green Auto Loan. The bank offers green auto loans with discounts that have set a benchmark for other similar products:
- On reducing interest rate: 0.50% discount
- On flat interest rate: 0.25% discount
HSBC
HSBC launched eco-friendly car finance products to encourage customers to buy hybrid or electric vehicles as part of the UAE’s 2021 Sustainability Vision
The bank offers similar reductions in interest rates to those on offer at Emirates NBD. If you want to check out affordability, they also have a useful calculator on their website.
National Bank of Fujairah
The National Bank of Fujairah unveiled its Green Auto Loan of up to AED 1 million (no more than 80% of the car’s value) for customers looking to finance environmentally friendly vehicles.
NBF’s Green Auto Loan is available to residents over the age of 18, earning more than AED 5,000 per month, for up to five years for new cars or 48 months for used cars. EV owners get a flat rate of 2.2% compared to a range of 2.75% to 4.25% for conventional car loans. The financing comes with a processing fee of 1% of the loan value or AED 2,500, whichever amount is lower.
Emirates Islamic
Emirates Islamic’s sharia-compliant car loans offer some of the lowest rates in the UAE, for conventional or electric cars. Their base interest rates start as low as 2.15% for UAE nationals and 2.29% for ex-pats.
Emirates Islamic also offers the potential for large loans, up to AED 1.5 million, depending on the individual’s circumstances.
Financing through car dealers
It is generally easy to arrange finance through a car dealership. As long as your credit history is good, you should be able to choose a car finance option that suits both your needs and your budget. They offer finance through their partnerships with many of the leading banks in the UAE, as well as other financial providers.
Dealers also offer a range of options including leasing, so you can compare all the alternatives.
Al-Futtaim Finance
Given that Al-Futtaim has around 40% of the car market in the UAE, you may well come across them in your search for a car. Through their finance division, they offer a range of options across their brands.
Their website has all the details, but one of the most attractive options for many people is the Auto Loan with Guaranteed Future Value. Every car depreciates in value over time, but this will give you peace of mind about how much it will be worth when you finish paying off your loan.
If you don’t want the hassle of depreciation at all and a more inclusive package – including insurance, servicing, breakdown cover and so on – then a car leasing option may be right for you.
So while it might feel great to splash the cash and buy a new car outright, there are many other, reasonably affordable options out there.
