Indian solar manufacturer and developer, Tata Power Solar, is to jointly launch a new nationwide initiative that it hopes will open up access to solar finance for prospective residential users.
Tata has joined forces with one of the largest loans and finance companies in India, Bajaj Finance, to offer a new monthly installment payment option for solar customers, with no-interest finance for Tata products.
The national finance programme will be rolled out across 20 cities first, then expanded across the entire country.
For solar products costing less than INR2.5 lakhs (US$4,000), instant credit is available.
Tata hopes the new finance mechanism will help consumers who would prefer to use solar, to diesel power, as diesel has a much lower initial upfront cost, but is more expensive over time, as well as damaging to the environment. “We aim to empower consumers by giving them different financial choices for products which can impact their lives,” said Devang Mody, president of consumer finance at Bajaj.
The partnership between Tata and Bajaj is aiming to make solar more affordable and accessible, with interest free finance options for solar lights to power packs and heaters, to solar powered water pumps, bought from Tata's solar product portfolio.
“Solar products are the need of the hour, given the increasing power shortage India is facing,” said Gagan Pal, vice president for products at Tata.
Pal said the programme has been designed to be simple to assist people who are hesitant to invest in solar, due to the initial upfront cost, “We are sure that this offer, with its strong financial incentive, will help people find our products very affordable,” said Pal.
Solar is “extremely economical in the long run”, Tata said in a statement, but “the entire investment is upfront”. According to Tata, the Bajaj monthly payment plan requires a small processing fee and down payment, with installments paid over seven to 10 months.
The business partnership between Tata and Baja will help Tata’s goal to provide solar energy to millions who are currently without any electricity.
The agreement will also assist the new prime minister, Narendra Modi, achieve his ambition for every household to have at least one light bulb – with solar playing a large part.