HSBC has launched Green Equipment Financing, a financing product which aims to promote the use of environmentally sound equipment in Hong Kong and Mainland China.
Under the Green Equipment Financing scheme, HSBC customers can enjoy interest rebates and a principal repayment moratorium when taking out a new loan for purchasing equipment which complies with environmental protection regulations. Machinery can be used in either Hong Kong or the Mainland.
Margaret Leung, HSBC’s group general manager, global co-head commercial banking, said: “We see huge potential in equipment financing with China’s rapidly developing economy. For the first half of 2007, the total loan amount for machinery was HK$6.7 billion (US$850 million) of which 90% was used in the Mainland,” she said.
Hong Kong’s Business Environment Council (BEC) will review the applications to ensure the loans will be approved only for machines that fulfill at least one of the following environmental protection criteria:
- reduction of energy consumption;
- reduction of water consumption;
- increased efficiency of production materials consumption;
- reduction of fuel consumption;
- elimination or reduction of noise production;
- reduction of waste production; or
- elimination or reduction of air, land or water pollution.
Dr Andrew Thomson, chief executive of BEC said: “Cleaner production is a growing imperative for running a sustainable business. I am delighted to see HSBC launch this Green Equipment Financing scheme, which will serve as a tremendous incentive for business decision makers to purchase equipment that can help ensure their market survival and improve our environment. BEC is proud to support HSBC in assessing the eligibility of applications for this new sustainable development initiative and we look forward to seeing various creative ways in which businesses will approach this sustainability challenge.”
From now until 18 July 2008, customers who apply for Green Equipment Financing and complete the drawdown on or before 31 October 2008 will enjoy up to a two-month interest rebate and an initial six-month loan principal repayment moratorium.
The advance ratio can be up to 100% of the asset cost or market value and customers can choose between a flat interest rate and a floating interest rate for repayment. In addition, businesses who issue documentary credits to equipment suppliers through HSBC will get 50% off the commissions.