IREDA To Establish Subsidiary For Retail Finance

IREDA Crosses Highest Annual Loan & Sanction Loan Disbursement for Renewable Energy Projects

In a clear sign of its determination to go it alone if required for achieving solar rooftop targets, the Chairman and Managing Director (CMD) of Indian Renewable Energy Development Agency Ltd. (IREDA), Pradip Kumar Das has confirmed IREDA’s plans for establishing a subsidiary to cater to retail projects encompassing Rooftop Solar, PM-KUSUM, Electric Vehicles, and other Business-to-Consumer (B2C) segments. Das said that IREDA can set up a wholly owned subsidiary to meet the needs of the Retail segments, subject to the approval of the Government of India. The CMD made the statement during a panel discussion on “Green Financing: Architecture for Accessible Finance”, held in New Delhi today, February 20, 2024 at an industry event.

The government has roped in PSUs for implementation of the PM Surya Ghar Muft Bijli Yojna, which has set a target of solar rooftop son 10 million households by 2026. IREDA will be expected to play a key role in ensuring  financing for the project, which will be upwards of Rs 75,000 crores potentially. While PSUs are allowed to work with private sector partners as well, there has been a push to go it alone, with the government blaming ‘vendor capacity’ in an apparent dig at the private sector, for missing its rooftop solar targets comprehensively this far. Customers are set to be provided loans at a special rate of 7% beyond the subsidies, to ensure quicker roll out and uptake of solar.

Das stressed IREDA’s commitment to making various Renewable Energy technologies bankable, including emerging ones like Electric Vehicles, Green Hydrogen, and Offshore Wind. He highlighted IREDA’s success story over the past three years in reducing Non-Performing Assets (NPAs), through addressing borrower concerns and bringing in improved transparency.

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The CMD underscored the significant role of Micro, Small, and Medium Enterprises (MSMEs) in environmental sustainability promising support for their involvement in the Renewable Energy sector. He emphasized the importance for MSMEs to improve their ratings and governance, in order to facilitate their access to finance for renewable energy projects, at competitive interest rates.