The Globe and Mail – Tuesday, November 29/06
PERSONAL FINANCE: BANKING
Credit unions flash their green with auto loans
A few of Canada's credit unions are putting the environment ahead of profits by offering
a financial incentive to clients who borrow money to buy low-pollution, fuel-sipping cars.
Let's say you've got your eye on a Toyota Prius, a fuel-efficient hybrid vehicle that has
low emissions of carbon dioxide, a greenhouse gas. Vancouver City Savings Credit
Union will finance the purchase with a loan at the prime rate, now 6 per cent. That's as
much as three to four percentage points less than a typical car loan, and it's enough to
save you hundreds or even thousands of dollars in interest.
Earlier this month, Vancity made its Clean Air Auto Loan available to people across the
country through its online banking division, Citizens Bank of Canada. Other credit unions
with similar offers are Bay Credit Union of Thunder Bay, Ont., and Credit Union
Atlantic of Halifax.
Banks and credit unions make money by lending money out at higher rates than they pay
on deposits. But Vancity also has a mission of reducing the amount of CO2 it emits as an
organization, and of giving its members a way to take action to support cleaner air.
"It's definitely less financially profitable for us to offer the Clean Air Auto Loan," said
Amanda Pitre-Hayes, senior sustainability programs manager at Vancity. "But we look at
not just the financial returns, but also the environmental returns."
The big banks will no doubt look at these cut-rate auto loans as yet another flakey
initiative from the crypto-commies of the credit union world. But in showing some
ethical leadership in areas like the environment, credit unions may have found a way to
lure customers away from banks.
"We have absolutely had people join the credit union because we offer this product," Ms.
Vancity began offering loans at prime for hybrid vehicles about three years ago, but it
recently revamped the offe