Octopus Energy customers will now have the option to use "buy now, pay later" scheme to fund and install solar panels, thanks to a new partnership with digital lender Zopa Bank.
This means that households can spread the cost of installation over several years. Octopus, the UK's largest electricity supplier with nearly seven million customers, believes this new financing offer will allow more people to benefit from this "cheap, clean energy source".
Households taking advantage of these new finance products will be able to purchase and install Octopus solar panels, spreading the cost over up to 84 monthly payments across seven years. Although "buy now, pay later", or BNPL, schemes are typically interest-free, the larger loan size from Octopus will see customers charged a 9.9% annual percentage rate (APR).
The cost for installing 10 panels and a five kilowatt hour (kWh) battery is approximately £9,200. The new financing options will also be available for those purchasing and installing app-controlled EV chargers, which fast-charge electric cars. BNPL has traditionally been offered for products like clothing, home essentials, furniture and electricals, through providers such as Klarna and Clearpay.
Generally, BNPL can help people spread the cost of purchases or defer payments to a later date, without incurring interest. However, there have been concerns raised that some individuals could accumulate too much debt, which could end up being difficult and costly to repay.
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Zopa has announced its latest batch of BNPL products, which are fully regulated and include thorough affordability and credit checks to prevent debt accumulation. Dave Farbrother, the head of the lender's retail finance division, commented on the initiative: "make the switch to energy sustainability more accessible for millions of UK consumers".
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