Delhi becomes the first state to provide interest subvention on electric vehicles
The interest rate subvention provided on electric autos will provide an additional incentive of Rs. 25,000 over the purchase incentive of Rs. 30,000
Going electric just became even more affordable: Kailash Gahlot
The online portal created by CESL will provide several options of approved vehicles to people along with ensuring that they receive the interest subvention on their loans via a smooth automated channel: Kailash Gahlot
New Delhi
Under the leadership of CM Shri Arvind Kejriwal, the Delhi Government today launched the ‘My EV’ portal to provide 5% interest subvention on purchase of electric auto rickshaws (e-autos) on loans under the Delhi Electric Vehicle (EV) Policy. This was done in collaboration with Convergence Energy Services Limited (CESL) with which the Department of Transport, Delhi Government had earlier signed an MoU to provide interest subvention to reduce the total cost of ownership of electric autos.
The ‘My EV Portal’ is an online portal which will enable the Letter of Intent (LoI) holders to purchase e-autos and claim the incentives provided by the Delhi Government. A total of 4,261 LOIs for e-autos are being given with a 33% reservation for women. The online portal has been made accessible to all users on the website of the Transport department of the Delhi Government. Delhi, the EV capital of India, promises to bring more innovations like these for faster adoption of Electric vehicles in the city. The Interest Subvention of 5% on loans on the purchase of EVs is in addition to the applicable purchase incentive of Rs 30,000 and scrapping incentives of up to Rs 7,500 under the Delhi EV Policy. Through this scheme, an electric auto consumer will be able to avail up to Rs 25,000 additional benefit.
With the launch of the ‘My EV’ portal (https://www.myev.org.in/) which provides a single window for purchase and financing of electric autos, the Delhi Government becomes the first state in the country to provide easy financing along with interest subvention on the purchase of EVs. Although the scheme is currently operational for electric autos but will soon be available on lithium-ion-based e-rickshaws, e-carts and electric Light Goods Vehicles in the national capital.
Delhi, since the launch of its ambitious EV policy in August 2020, has been continuously working in promoting and incentivizing the sales of Electric vehicles. In the last few months, electric vehicles contributed to over 10% of total vehicle sales in Delhi. With more than 38,000 electric vehicles sold since the announcement of the Delhi EV Policy, in August 2020, access to attractive financing solutions and options is still one of the major deterrents for achieving the critical mass. Currently, the rate of interest on EVs can vary from 25% to 30% for some vehicle segments which makes owning an Electric Vehicle a cost-intensive proposition.
To overcome these barriers and make it more affordable for the buyers, the Transport Department has partnered with CESL which is a subsidiary of Energy Efficiency Services Limited (EESL) owned by Central Public Sector Units (CPSUs). Under this partnership, CESL has empanelled 6 Financial Institutions (FIs) – Mahindra Finance, Akasa Finance, Mannapuram Finance, RevFin and Prest Loans through an open and transparent process to provide loans to electric vehicles at attractive terms. Through this empanelment, the FIs will provide loans with a minimum 80% Loan-to-Value (LTV) at interest rates of a maximum of 20% (including the interest subvention) for a loan tenure which is in the best interest of the consumer. For reference, if the mandatory maximum interest rate is 20%, Financial Institutions (FIs) empanelled by CESL are expected to provide loans to the borrowers at interest rates not more than 15%. The process of empanelment shall be kept open for new financial institutions, scheduled banks and NBFCs to apply in the future as the scheme expands to other vehicle segments too.
Delhi Transport Minister Shri Kailash Gahlot in a statement said “Under the visionary leadership of Shri Arvind Kejriwal, we delivered what we had promised to our citizens. The online portal created by CESL will give various approved vehicle options for LOI holders to choose from and also help in ensuring that they receive the interest subvention on their loans via a smooth automated channel. With the aggregation of vehicles, the cost of the Electric auto is also expected to be lower, making it affordable for the people.”