SBI may bundle home loans with rooftop solar installations under Green Funding

18 Sep 2023 , 09:45 AM

SBI, the country’s largest lender, intends to bundle and require rooftop solar installations for residential projects supported by the bank’s long-term climate action funding drawn from multilateral organizations.

As of June, the SBI had a home loan book of over Rs 6.3 lakh crore and outstanding currency loans of USD 2.3 billion from multilateral lenders such as the World Bank, the Asian Development Bank, and Germany’s KfW.

These loans have 10-year or 20-year maturities, putting borrowing banks at risk of currency fluctuations.

‘We intend to make rooftop solar installations mandatory for builders if the project is funded by our green funds,’ said Ashwini Kumar Tewari, Managing Director Risk, Compliance, and Stressed Assets at SBI.

Given the risks associated with long-term FX loans, Tewari asked multilateral lenders to allow borrowing banks to hedge their exposures in order to make green and financial inclusion funding more viable. Tewari further stated that the bank is boosting its exposure to green initiatives such as green building funding, battery recycling, and solar rooftop planning, among others.

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