Financing a solar installation in 2026 no longer requires a large upfront payment. Public sector banks such as SBI, PNB, Bank of Baroda, Union Bank and Canara Bank offer dedicated rooftop solar loans linked to the PM Surya Ghar scheme. HDFC Bank has no dedicated solar loan; homeowners use its home improvement loan or home loan top-up. IREDA (Indian Renewable Energy Development Agency) finances rooftop solar only for large commercial, industrial and institutional projects. At the 5.75% scheme rate for loans up to ₹2 lakh, the EMI on a ₹2 lakh loan over 10 years is about ₹2,195 per month, less than many household electricity bills. A ₹3 lakh loan at 7.90% over 10 years has an EMI of about ₹3,624. Use the solar calculator to run the EMI for your own loan.
Direct answer. For households, the cheapest solar loans in 2026 are the PM Surya Ghar bank loans: 5.75% up to ₹2 lakh at SBI, Union Bank and Bank of Baroda, and 7.90% from ₹2 lakh to ₹6 lakh at SBI. HDFC has no dedicated solar loan; its home improvement loans list at 7.75% to 13.20%. Compare lenders in the table below.
Choosing the right lender can save you ₹30,000–₹60,000 in total interest over the loan tenure. This comparison covers every major lender’s rate, eligibility criteria, and processing steps so you can pick the best option for your situation.
Why Solar Loans Have Improved Dramatically in 2026
The solar financing landscape has changed significantly. Banks now treat rooftop solar as a productive asset, not a luxury purchase, because the system generates quantifiable bill savings. The Reserve Bank of India’s priority sector lending guidelines classify solar installations under renewable energy, which gives banks incentive to offer competitive rates.
The bigger change for households is the PM Surya Ghar loan framework. MNRE’s operational guidelines envisage standardised low-interest loans near the benchmark rate (repo + 0.5%) for residential systems up to 3 kW, offered through the national portal and the JanSamarth portal. With the RBI repo rate at 5.25%, that is the 5.75% that SBI, Union Bank and Bank of Baroda now list for loans up to ₹2 lakh. When you finance through such a loan, the subsidy is credited to your loan account.
The net result for consumers: solar is now more accessible than ever. You can finance 80 to 90% of the system cost, repay it from the electricity savings, and still come out net-positive on cash flow from month one in many cases.
Bank-by-Bank Interest Rate and EMI Comparison
The table below compares the products these lenders actually list for rooftop solar, as checked on their websites on 2 October 2026. EMI figures are for a ₹2,00,000 loan over 10 years at the listed rate.
| Lender and product | Interest rate | Loan tenure | Max loan amount | Processing fee | EMI (₹2L, 10yr) |
|---|---|---|---|---|---|
| SBI Surya Ghar loan | 5.75% up to ₹2 lakh; 7.90% above ₹2 lakh | Up to 120 months incl. 6-month moratorium | ₹6 lakh | Nil | ₹2,195 |
| PNB rooftop solar scheme | Not stated on the scheme page; ask the branch | Up to 10 years incl. 6-month moratorium | ₹2 lakh (up to 3 kW); ₹6 lakh (3 to 10 kW) | Nil | Depends on rate |
| Bank of Baroda PM Surya Ghar loan | 5.75% up to ₹2 lakh; above that, per its home loan scheme (from 7.90%, linked to CIBIL) | Up to 120 months | ₹6 lakh | Nil | ₹2,195 |
| Union Bank rooftop solar | 5.75% up to ₹2 lakh; EBLR + 1.00% (CIC 750+) or + 1.50% above ₹2 lakh | Up to 10 years | ₹6 lakh (₹15 lakh with a home loan, up to 25 kW) | Nil up to ₹2 lakh; 0.50% + GST above | ₹2,195 |
| HDFC home improvement loan / top-up | 7.75% to 13.20% / 8.00% to 13.70% | Top-up up to 15 years | Based on property value and eligibility | See HDFC’s charges page | ₹2,400 at 7.75% |
Sources: SBI, PNB, Bank of Baroda, Union Bank, HDFC home improvement and top-up pages. Rates are floating and change with the repo rate; confirm on the day you apply. IREDA is not in the table because it does not lend to households (see below).
💡 Fast tip
SBI's Surya Ghar loan is linked to its external benchmark rate: 5.75% up to ₹2 lakh, with no minimum CIBIL score, and 7.90% above ₹2 lakh, where SBI asks for CIBIL 650 and ₹3 lakh annual income. If your loan is just above ₹2 lakh, a slightly larger margin can keep you in the cheaper band.
SBI Solar Loan: Rates, Eligibility, and Process
State Bank of India’s household product is the SBI Surya Ghar – Loan for Solar Roof Top, for resident individuals with rooftop rights on the house where the system will be installed. (SBI’s Surya Shakti solar finance is a separate product for SME and business enterprises.)
Key SBI Surya Ghar loan parameters, per SBI’s product page:
- Interest rate: 5.75% p.a. up to ₹2 lakh; 7.90% p.a. above ₹2 lakh (floating, linked to SBI’s external benchmark rate)
- Maximum loan: ₹6 lakh, for systems up to 10 kW
- Tenure: Up to 120 months, including a 6-month moratorium
- Security: Hypothecation of the solar assets; no property mortgage
- Margin: At least 10% of the project cost
- Credit and income: no minimum CIBIL score or income up to ₹2 lakh; CIBIL 650 and ₹3 lakh annual income above ₹2 lakh
- Processing fee: Nil
- Pre-payment: No pre-payment penalty
SBI pays the loan and your margin directly to a vendor registered on the PM Surya Ghar national portal, after the feasibility reports mandated by MNRE are submitted, and you apply on the JanSamarth portal after registering on pmsuryaghar.gov.in. Heaven Green Energy is MNRE-empanelled across UGVCL, DGVCL, MGVCL, and PGVCL in Gujarat, which means our quotations are accepted directly by SBI for loan processing.
For a detailed breakdown, read our SBI solar loan guide for 2026. You can also check SBI’s official Surya Ghar loan page for current scheme details.
HDFC for Solar: Home Improvement Loan and Top-Up Rates
HDFC Bank does not list a dedicated solar loan. Homeowners finance rooftop solar through two secured home loan products: a home improvement loan at 7.75% to 13.20% p.a. for owners without an HDFC home loan, or a home loan top-up at 8.00% to 13.70% p.a. for existing HDFC home loan customers 12 months after final disbursement. Both are repo-linked and secured on your house, so expect a property check. These are not PM Surya Ghar scheme loans, so plan to use the subsidy, which normally reaches the bank account you submitted on the portal, to prepay.
Tenure, foreclosure terms, eligibility and EMI tables are in our HDFC solar loan guide for 2026. Current rates are published on HDFC’s home improvement loan and top-up loan pages.
IREDA Solar Loan: Only for Large Commercial Projects
IREDA (Indian Renewable Energy Development Agency) is the government-owned NBFC dedicated to renewable energy finance. It does not offer a residential solar loan. Its rooftop product is the Loan Scheme for Financing Rooftop Solar PV Grid Connected / Interactive Power Projects (Industrial, Commercial and Institutional):
- Minimum size: at least 1,000 kWp per application, either from a single roof owner or aggregated across several roofs (each sub-project at least 20 kWp)
- Loan: 70% of project cost (up to 75% at IREDA’s discretion), with at least 30% promoter contribution
- Rate: linked to IREDA’s credit grading of the project, as applicable from time to time
- Tenure: up to 10 years with a 12-month moratorium from commissioning; up to 15 years for projects with highly rated private off-takers or government PPAs
So IREDA is relevant to developers and large C&I buyers, not to a home or small shop. Households should start with a PM Surya Ghar bank loan, and small businesses with bank MSME loans (see our MSME and Mudra solar loan guide). See IREDA’s scheme list for the current scheme document.
The EMI Payback Alignment Framework
At Heaven Green Energy, we use a tool called the EMI Payback Alignment Framework to help buyers choose loan terms that make their solar investment cash-flow positive from month one.
The principle is simple: your monthly EMI should be less than or equal to the monthly electricity bill savings the solar system generates. When EMI ≤ bill savings, you pay zero net cost and own the system free and clear after the loan tenure.
Here is how to apply it:
This framework is far more useful than comparing interest rates in isolation. A marginally higher rate with a longer tenure can be cash-flow positive, while a lower rate with a short tenure can create negative monthly cash flow.
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PNB Rooftop Solar Loan: Terms and Eligibility
Punjab National Bank finances household systems under its Scheme for Financing of Rooftop Solar Power Systems, linked to PM Surya Ghar and sourced through the JanSamarth portal:
- Interest rate: not stated on the scheme page; ask the branch for the current rate
- Maximum loan: ₹2 lakh for systems up to 3 kW; ₹6 lakh for systems above 3 kW and up to 10 kW
- Margin: 10% up to ₹2 lakh; 20% above ₹2 lakh
- Tenure: Up to 10 years, including a 6-month moratorium
- Processing fee: Nil
- Eligibility: CIC score of 680, including applicants with no credit history; owner of the residential property with rooftop rights; joint applications with a parent, spouse or earning child are allowed
- Documentation: KYC, latest electricity bill, ownership proof, quotation with the feasibility reports mandated by MNRE; above ₹2 lakh, one year’s ITR or Form 16 and six months of bank statements, plus a third-party guarantee
PNB’s main advantage for small loans is that loans up to ₹2 lakh need no income assessment and no third-party guarantee. See PNB’s scheme page for current terms.
Common Mistakes When Applying for a Solar Loan
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1
Applying without the feasibility paperwork, SBI and PNB pay the vendor only after the feasibility reports mandated by MNRE are submitted, so get your DISCOM feasibility and [net metering](https://qbitsenergy.com/blog/net-metering-india-complete-guide/?utm_source=hge&utm_medium=blog&utm_campaign=portfolio) application moving early.
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2
Choosing the shortest tenure to save interest, A short tenure creates high EMI. If EMI exceeds bill savings, the system is cash-flow negative. Use the EMI Payback Alignment Framework above.
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3
Not planning where the subsidy goes, With a PM Surya Ghar bank loan, enter the loan account number on the portal so the subsidy is credited to the loan account. With any other loan it reaches your bank account and you must prepay yourself. Read about the [PM Suryaghar application process](/blog/pm-suryaghar-complete-guide).
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4
Using a vendor not registered on the PM Surya Ghar national portal, SBI disburses only to vendors registered on the national portal, and the subsidy depends on it too. Check the vendor on the portal before getting a quote.
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5
Ignoring the hidden costs of solar financing, Processing fees, insurance, and pre-payment penalties add to total cost. Check our guide on [hidden costs of solar financing](/blog/hidden-costs-of-solar-financing).
⚠️ Watch out
Some fintech solar loans advertise "0% interest" but embed the interest cost in a higher system price. Always compare the total cost of ownership, system price plus all financing charges, not just the advertised rate.
Pros and Cons of Solar Loans vs. Outright Purchase
- Low upfront capital, start saving from month one
- System ownership stays with you (unlike OPEX/[PPA](/glossary/ppa))
- You claim full [Accelerated Depreciation](/glossary/accelerated-depreciation) tax benefit
- Loan interest is tax-deductible for businesses
- Interest adds to total cost (about ₹63,000 on ₹2 lakh over 10 years at 5.75%)
- Floating rates can increase EMI over time
- Credit score and income documents required above ₹2 lakh at most banks
- [O&M](/glossary/o-and-m) costs remain your responsibility
How Heaven Green Energy Helps You Get the Best Solar Loan
Heaven Green Energy’s finance team has processed over 2,000 solar loans in Gujarat, from SBI and PNB PM Surya Ghar loans to HDFC home loan top-ups. We know which branch managers approve quickly, what documentation each lender actually needs, and how to structure the project cost to maximise your loan-to-value ratio.
- Residential Solar: end-to-end support including SBI/HDFC loan documentation and PM Suryaghar subsidy filing.
- Commercial Solar: IREDA loan support with ROI modelling showing EMI vs. bill savings from month one.
- Industrial Solar EPC: project finance structuring for 100 kW+ with DSCR analysis.
- Solar Calculator: enter your bill and see your EMI vs. savings comparison instantly.
Contact our team at +91 63904 05060 or request a callback, our finance specialist will recommend the best lender for your profile.
Frequently Asked Questions
Which bank offers the lowest interest rate for solar loans in India in 2026?
For households, the lowest listed rate is 5.75% p.a. for PM Surya Ghar loans up to ₹2 lakh, offered by SBI, Union Bank and Bank of Baroda (checked 2 October 2026). Above ₹2 lakh, SBI lists 7.90% up to ₹6 lakh. These are floating rates linked to the banks’ external benchmark, so they move with the RBI repo rate. IREDA does not lend to households; its rooftop scheme starts at 1,000 kWp.
What is the EMI for a ₹3 lakh solar loan over 10 years?
At SBI’s 7.90% rate for loans above ₹2 lakh, the EMI for a ₹3 lakh loan over 10 years is approximately ₹3,624 per month. At 9%, it rises to about ₹3,800. Use our solar calculator to model different scenarios. Most 5 to 7 kW systems after PM Suryaghar subsidy fall in the ₹2 to 3 lakh loan range.
Does SBI offer a solar-specific loan or is it a personal loan?
SBI offers a dedicated product, the SBI Surya Ghar – Loan for Solar Roof Top, for households: up to ₹6 lakh, secured by hypothecation of the solar assets, at 5.75% up to ₹2 lakh and 7.90% above. It is not a personal loan. For businesses, SBI lists Surya Shakti – Solar Finance. Personal loans cost far more: ICICI lists 9.99% to 16.50%, for example, so check a scheme loan first.
Is IREDA better than bank loans for solar?
Only for large projects. IREDA has no residential solar loan; its rooftop scheme finances commercial, industrial and institutional projects of at least 1,000 kWp, at 70% of project cost (up to 75%), for up to 10 years (15 in some cases). Homeowners should use a PM Surya Ghar bank loan, and small businesses a bank MSME loan.
Can I get a solar loan without property as collateral?
Yes. PM Surya Ghar bank loans at SBI, PNB, Bank of Baroda and Union Bank go up to ₹6 lakh and are secured by hypothecation of the solar system, not a property mortgage. SBI sets no minimum CIBIL score up to ₹2 lakh and asks for 650 above that. HDFC’s home improvement and top-up loans, by contrast, are secured on your house. For businesses, CGTMSE-covered MSME loans can be collateral-free.
How long does solar loan approval take?
SBI and PNB do not publish a fixed timeline; it varies by branch. Common delays: a vendor that is not registered on the PM Surya Ghar national portal, missing feasibility reports, name mismatches between the electricity bill and KYC, or income documents for loans above ₹2 lakh that do not match the ITR. Heaven Green Energy provides all installer-side documents within 24 hours of request.
Can I prepay my solar loan without penalty?
SBI states there is no prepayment penalty on its Surya Ghar loan, and Bank of Baroda lists no foreclosure charges. HDFC charges no foreclosure fee on variable-rate home loans; a 2% charge applies only to fixed-rate periods. Under RBI rules, floating-rate loans to individuals for non-business purposes carry no pre-payment charges. Fixed-rate personal loans are different: ICICI, for example, charges 3% of the outstanding principal until 24 EMIs are paid. Always check the prepayment clause before signing.