Credit card perks could help spur switch to electric vehicles

Observers say banks should relook incentives to help promote sustainability

- Prisca Ang

Your credit cards that come with petrol discounts might soon have more perks for electric vehicle (EV) charging and other sustainable products, as banks drive towards their net-zero commitments.

Financial institutions can align more closely with their sustainability goals by adjusting their products for individual customers to encourage the use of cleaner energy, observers told The Straits Times. When it comes to institutional and corporate clients, a few banks have set out decarbonisation targets for sectors such as power, automotive, and oil and gas.

Singapore Management University associate professor of finance Liang Hao noted that many motorists still rely on petrol, and until cleaner-energy vehicles become more widespread, banks need to continue supporting their current customer base.

"Transitioning too abruptly could alienate customers and limit the effectiveness of sustainability initiatives," said Prof Liang, who is co-director of the Singapore Green Finance Centre.

But he added that credit cards can significantly influence consumer behaviour, and banks can play a pivotal role in facilitating the transition through incentives such as rewards for EV charging and discounts on green products and services.

Petrol and diesel cars accounted for nearly 84 per cent of total cars in Singapore as at the end of May, while petrol-electric hybrids made up 13 per cent.

EVs and plug-in hybrids contributed to just 3 per cent of total cars, but their number had risen to 18,173 as at the end of May, up from about 13,300 as at the end of 2023.

From 2030, all new car registrations here will have to be of cleaner-energy models, including electric, hybrid or hydrogen fuel cell cars.

Banks have continued with longrunning perks for motorists who use petrol, but they are also increasingly catering to EV drivers.