Solar Financing Options in South Africa
Can't afford to pay cash for solar? You're not alone. Here are the different ways to finance a solar system in South Africa — and which option saves you the most money.
Key Takeaways
- Cash payment gives the best return — no interest to pay
- Bank loans (like FNB Solar Loan) offer 3-7 year terms
- Rent-to-own means no upfront cost but you pay more overall
- Some companies offer Power Purchase Agreements (PPAs)
- Your monthly loan payment should be less than your electricity savings
Option 1: Pay cash
If you have the money available, paying cash is always the best option. You get the full savings from day one with no interest charges eating into your returns.
- Best ROI — payback in 4-6 years
- No monthly payments to worry about
- You own the system outright from day one
- Downside: need R80,000-R250,000 upfront
Option 2: Bank loan
Several SA banks now offer specific solar loans. FNB, Nedbank, and Standard Bank all have solar finance products.
- Typical term: 3-7 years
- Interest rate: prime to prime + 2%
- Monthly payment should be less than your electricity savings
- You own the system — it adds value to your property
- FNB Solar Loan: up to R500,000, no deposit required
Option 3: Rent-to-own
Companies like Hohm Energy and SolarAfrica offer rent-to-own. They install the system and you pay a monthly fee. After 5-7 years, you own it.
- No upfront cost — R0 deposit
- Fixed monthly payment (usually less than your current bill)
- Maintenance included during the rental period
- Downside: you pay more overall due to the financing markup
- Make sure you understand what happens if you sell your house
Option 4: Power Purchase Agreement (PPA)
With a PPA, a company installs solar on your roof for free. You buy the electricity from them at a rate cheaper than Eskom. You never own the panels.
- Zero upfront cost
- You just pay for electricity at a lower rate
- Company handles all maintenance
- Usually a 15-20 year contract
- Best for businesses, less common for homes
Which option is best?
The golden rule: your monthly solar payment (loan or rental) should be LESS than your current electricity bill. If it is, you're saving money from month one. Cash is best for long-term returns. A bank loan is the next best. Rent-to-own is good if you can't qualify for a loan. Use our Solar ROI Calculator to compare scenarios.
Ready to see your own numbers?
Use the Solar ROI Calculator