Australia has traditionally loved its dinosaur-burning, fuel-sucking V8 engines. However, as we look to a cleaner, greener future, many have made tracks to purchasing more eco-friendly, fuel efficient vehicles. This has given rise to the question: Shouldn’t we be rewarded somehow for opting for a green car?

As Kermit says, it ain’t easy being green. The mere tingly feeling in response to saving the dolphins isn’t enough. This is where green car loans step in, often with a discounted interest rate over regular car loans, but what cars qualify? More might qualify than you think.

In the market for a green car? The table below features car loans with some of the lowest fixed interest rates on the market for fuel efficient vehicles.

Rates
Features
Fees
Other
Lender
FixedNew1 year
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Approval within 24 hours
  • Save the planet. Save thousands on your car loan.
  • Get a discounted rate if you buy electric
  • Required: Good credit history, stable employment history. Aus citizenship or PR.
Approval within 24 hours

Green Car Loan Fixed

  • Save the planet. Save thousands on your car loan.
  • Get a discounted rate if you buy electric
  • Required: Good credit history, stable employment history. Aus citizenship or PR.
More details
FixedNew, Used7 years
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Hybrid and Electric Car Loan

    More details
    VariableNew99 years
    More details

    Green Car Loan

      More details
      Important Information and Comparison Rate Warning

      All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here.

      The comparison rates in this table are based on a loan of $30,000 and a term of 5 years unless indicated otherwise. The comparison rates for car loans and secured personal loans for the relevant amounts and terms are for secured loans unless indicated otherwise. The comparison rates for unsecured personal loans are applicable for unsecured loans only. WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. Comparison rates are not calculated for revolving credit products.

      Monthly repayment figures are estimates only, exclude fees and are based on the advertised rate for the term and for the loan amount entered. Actual repayments will depend on your individual circumstances and interest rate changes. Rates correct as of April 24, 2024. View disclaimer.

      What qualifies as a green car?

      Across the different lenders offering green car loans in Australia, the criteria for what qualifies as a ‘green car’ can vary. Generally, all lenders encourage interested customers to get in touch to find out if their desired car qualifies.

      Loans.com.au

      Online lender loans.com.au says a car is likely to qualify for its low rate green car loan if the car is:

      • a new or a demonstration vehicle
      • more fuel efficient than average for a car of its size
      • a hybrid or electric vehicle

      Some models belonging to the Mazda 2, Ford Fiesta, Honda Jazz and Volkswagen Golf range fit this criteria, according to loans.com.au.

      But it’s not just small cars and hybrid/electric vehicles that qualify. As stated, the car needs to be more fuel efficient than average for a car of its size, so you may find there are some fuel-efficient utes, four-wheel drives and vans that are eligible.

      In the interest of full disclosure, Loans.com.au and Savings.com.au are both part of the FirstMac Group.

      BankFirst

      Victoria-based mutual bank BankFirst offers its green car loan to borrowers purchasing cars “with CO2 value of 180 g/km or less”, as rated by the Australian Government’s Green Vehicle Guide website.

      Some examples of cars that BankFirst lists as ‘green cars’ that qualify for its loan include the Toyota Corolla, Kia Cerato, Mitsubishi ASX and ‘most Nissan X-trails’.

      Bank Australia

      Bank Australia offers a 100 basis point interest rate reduction and a waiver of its $150 establishment fee to car loan borrowers purchasing a “low emission vehicle (LEV)”.

      According to this bank, a car may qualify as an LEV if it is “Pure Electric, Plug In Hybrid Electric, Regenerative Hybrid or the internal combustion engine produces less than 125 g/km Tailpipe C02 (g/km) as published by Green Vehicle Guide”.

      This green car criteria is more stringent than other lenders', so bigger cars that aren’t electric or a hybrid are less likely to qualify.

      Top eight selling green car list

      We’ve picked eight cars from the Federal Chamber of Automotive Industries' top 20 selling cars for 2019 which are likely to qualify for a green car loan with one or more lenders in Australia.

      We’ve also assessed each model’s combined carbon emissions on the Government’s Green Vehicle Guide, expressed as g/km.

      8. Volkswagen Golf

      VW Golfs are nearly as synonymous with small cars as Corollas, and have been a staple for more than 40 years. The 1.4L 7 speed auto 110TSI hatch variety emits just 128g/km.

      7. Mazda CX-3

      Mazda’s little SUV the CX-3 is popular with a broad range of drivers. The 1.5L 2WD turbo diesel model emits 125g/km.

      6. Subaru Forester

      Loved by soccer mums, the gluten-intolerant, and off-road enthusiasts alike, the mighty Forester may qualify as a green car with some lenders. Emissions start from 152g/km for the 2.0L engine and 168g/km for the 2.5L engine.

      5. Toyota Camry

      This one is a slam dunk for Toyota, as all hybrid cars are typically included on any lender’s 'green car list, of which in the Camry line-up there are a few. The hybrids emit between 96g/km and 103g/km.

      4. Mitsubishi Outlander

      Chances are you might have forgotten about the Outlander in the sea of SUVs for sale, but it’s on this list of green cars. Two models feature - the ‘PHEV’ range by default as they are plug-in hybrids, and the 2.4L petrol variety. The hybrid models emit just 41g/km, while the 2.4L petrols start at 166g/km.

      3. Hyundai i30

      Ah yes, the car my grandma used to own - the venerable i30. The manual version emits 119g/km, while the auto emits 124g/km. Who knew stick drivers were the superior race?

      2. Toyota Corolla

      What list would be complete without mention of a Corolla? There are quite a few hybrid Corollas to choose from, and emissions are as low as 81g/km.

      1. Ford Ranger

      Loved by tradies and weekend warriors alike, Ford Rangers with engine capacities up to 2.2L may make the cut as a green car with some lenders. The manual model’s emissions start at just 169g/km, while the 10 speed auto’s start at 177g/km.

      Saving.com.au's two cents

      As more effort is made to go green around the world, vehicles and the daily commute are under increased scrutiny. It could be tempting to replace that older clunker in your driveway, but first consider if you can afford a new, green car. A green car may not be expensive in the grand scheme of things, but in our research, cars older than a couple years often fail to make the cut. This is because qualifying cars usually need to be new or demo.

      As well as this, the Green Vehicle Guide doesn’t take into account the total amount of carbon emitted in manufacturing and shipping the vehicle to our shores. So, even though your desired car may have low emissions, the manufacturer may have burned a bit of oil to make the thing. All in all, it doesn’t make much financial sense to toss a perfectly reliable vehicle for a new car just because it’s green, but then again, humans aren’t rational creatures, so do what you like - just do your research beforehand.