5 June 2024

Absa, in collaboration with the International Finance Corporation (IFC), is proud to announce an exciting new initiative within the South African residential market aimed at promoting sustainable green living.

This three-year initiative, which takes the form of a rebate to customers, will support prospective homeowners with the purchase of green-certified homes through the UK-IFC Market Accelerator for Green Construction (MAGC) programme. The MAGC programme provides blended concessional finance and advisory support to catalyse the development of green buildings across emerging markets. 

Customers who purchase properties, valued at less than R5 million, directly from an Absa-approved Eco Home Loan development are now eligible to receive between 1.5% to 3% of their loan amount back in a rebate. This incentive will be credited directly into the customer's home loan account and capitalised against the outstanding balance, thus reducing their loan amount and saving them further interest over the term of their mortgage.

"We are thrilled to be the first South African bank to introduce such a rebate in the residential property market," says Nondumiso Ncapai, Managing Executive for Absa Home Loans. "This initiative is not just about promoting green living; it's about being a catalyst for an industry-wide shift towards sustainability. By incentivising the purchase of eco-friendly homes, we are paving the way for a more sustainable future and demonstrating our commitment to our ESG goals."

Absa introduced South Africa’s first Eco Home Loan in collaboration with Balwin Properties in 2020, offering customers who purchase properties in Excellence in Design for Greater Efficiencies (EDGE) certified developments a rate concession of 0.25% on their mortgages. The EDGE standard sets minimum thresholds for energy and water consumption savings for homes to be classified as eco-friendly.

In addition to this 0.25% rate concession, qualifying Absa customers now stand to save further on their EDGE-certified homes as illustrated below.

Combined interest savings with the Absa Eco Home Loan

Original loan amount

R1 000 000

Loan less 1.5% rebate applied at registration (0 months)

R985 000

Interest rate (prime minus 0.25% concession)


Total interest savings with 0.25% concession applied

R41 466

Total interest savings with rebate capitalisation (including a further 1.5% rebate at 36 months)

R42 605

3% rebate total

R30 000

Combined interest savings over 20 years

R114 071

*These are illustrative values based on a home loan of R1 000 000, with an interest rate of 11.50% (prime rate minus 25bps). In this illustration the rebate of 1.5% was discounted at commencement of the loan and a further 1.5% discounted at 36 months, accumulating to a total rebate of 3%. Other charges such as initiations fees, service fees and insurance are excluded over the loan term.

Market Potential and Environmental Impact

This initiative is part of Absa's broader commitment to sustainability and is an extension of a range of home loan products designed to provide customers with access to housing that reduces their carbon footprints and promotes eco-friendly living. Absa is a leading funder of renewables in Africa and has committed support to South Africa’s just transition to a low carbon economy through a long-term ambition to reach Net Zero state by 2050 for scope 1, 2, and 3 emissions.

This residential property rebate is part of a R4.5 billion deal between Absa and IFC. The IFC estimates that the broader project has the potential to reduce South Africa's annual emissions by over 12 000 tons, marking a substantial environmental impact.

“IFC is dedicated to supporting access to eco-friendly and resource-efficient residential options in South Africa as a measure against climate change, to safeguard the environment, and to bolster economic growth," said Adamou Labara, IFC's Country Manager for South Africa. "Our partnership with Absa will help promote green housing as an option for prospective homeowners."

Join Us in Greening South Africa

Absa invites developers and prospective homeowners to be part of this transformative journey towards a more sustainable future. By choosing an eco-friendly home, customers not only benefit financially but also contribute to a healthier, greener planet. Visit the Absa Home Loans page to find out more.