Solar Loan: Complete Guide for MSMEs & Businesses

For most MSMEs in India, electricity costs can take up a significant portion of operating expenses, often ranging between 5% and 30% of their income. Reducing these operational expenses is a key priority for business owners aiming to maximize profits. With the increasing awareness and accessibility of solar power, more businesses are recognizing the benefits of installing solar panels on their rooftops. However, the challenge remains in securing the necessary capital and understanding the financing options available.

In this article, we'll walk you through how Aerem Solar Loans can help you overcome these challenges, offering flexible,cost-effective financing options that align with your business needs.

Key Benefits of Aerem Solar Loans?

1. Tailored Financing Solutions
   • Unique Offering: Aerem provides Solar Loans specifically tailored to the needs of MSMEs and homeowners through its in house NBFC making it a specialized service provider in the solar financing sector.
   • Advantage:Unlike generic financial institutions, Aerem understands the unique challenges faced by MSMEs and offers flexible loan terms. While providing competitive interest rates and customized financing plans that align with their cash flow and business requirements Aerem enables a quality solar installation in the process.
2. End-to-End Support with Aerem Asset Assurance(AAA)
   • Unique Offering: Aerem’s AAA team provides a comprehensive technical assessment of the solar project, ensuring that the EPC’s proposal meets the highest industry standards.
   • Advantage: This end-to-end support not only helps in identifying the most reliable and cost-effective EPC contractors but also ensures that the solar installation is optimized for maximum efficiency and savings. Customers can be assured that their investment in solar energy is sound and will deliver the expected returns.
3. Simplified Application Process
   • Unique Offering: Aerem’s loan application process is designed to be straightforward,with a dedicated team to guide applicants through every step, whether initiated by the EPC or directly by the customer.
   • Advantage: The simplified and transparent process minimizes the paperwork and time required, making it easier for MSMEs to transition to solar energy without the usual hassles associated with securing financing.
4. Fast-Track Loan Approvals:
   • Unique Offering: Aerem offers fast-track loan approvals, reducing the waiting time significantly compared to traditional banks.
   • Advantage: This quick turnaround time allows businesses to begin their solar projects sooner, enabling them to start saving on electricity costs almost immediately
5. comprehensive Market Coverage:
   • Unique Offering: Aerem's services are not limited to a specific type of customer; they cater to a broad range of entities, including individuals, MSMEs, LLPs, public and private limited companies, societies and trusts.
   • Advantage:This broad coverage ensures that Aerem can accommodate a wide variety of customer needs and business structures, making solar energy accessible to all types of organizations.
6. Strong Track Record and Customer Trust:
   • Unique Offering: Aerem has already partnered with 500+ MSMEs and homeowners,delivering tailored solar solutions that have proven successful.
   • Advantage: Aerem’s strong track record helps build trust and confidence in potential customers owners looking to adopt solar, assuring them of our experience and expertise to deliver on our promises.
7. Integrated Solar Ecosystem:
   • Unique Offering: Aerem is not just a financier but a partner in the entire solar value chain, offering services beyond just loans. This includes our SunStore marketplace for top-quality equipment and AeROC, our solar asset monitoring platform.
   • Advantage: By providing these additional services, Aerem offers a one-stop solution for everything solar, simplifying the process for customers and ensuring a seamless experience from financing to installation to ongoing management.
8. Collateral Free Loans:
   • Unique Offering: Aerem offers collateral-free loans for solar installations, meaningthat MSMEs and homeowners don’t need to pledge any assets to secure the financing.
   • Advantage:This eliminates a significant barrier for businesses that may not have sufficient collateral to qualify for traditional loans, making solar energy accessible to a broader audience. With Aerem, you can finance your solar project any collateral.
9.  100% Digital Process
   • Unique Offering: Aerem provides a completely digital journey through the Aerem Customer App.
   • Advantage:The 100% digital journey significantly reduces the time and effort required to apply for and manage a solar loan. With easy access to your loan status,real-time updates, and the ability to upload necessary documents from anywhere,the digital process is not only faster but also more transparent, allowing you to focus on your business while we take care of the financing.

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Who can apply for Aerem Solar Loan?

The following are eligible to apply for anAerem Solar Loan:

1. Individuals
   • Individuals who own a property where the solar installation is planned and meet the basic eligibility criteria such as a good credit history and repayment capacity
2. Proprietorship Concerns
   • Sole proprietorships operating a business and owning the property for solar installation
3. Partnership Firms
   • Registered or unregistered partnership firms that own the property or have valid leasehold rights for the solar plant installation
4. Limited Liability Partnerships (LLPs)
   • LLPs that are legally recognized with a Certificate of Incorporation and own or lease the property for solar installation
5. Private Limited Companies
   • Privately held companies that have the necessary statutory documents like a Certificate of Incorporation, and that own or have lease hold rights to the property for solar installation
6. Public Limited Companies
   • Publicly traded companies with the required statutory approvals and property ownership or leasehold rights
7. Associations of Persons (AOPs)
   • AOPs with a PAN card and Trust Deed (if applicable), having a clause to borrow, owning or leasing the property for the solar installation
8. Societies
   • Registered societies that own or have leasehold rights to the property and meet the eligibility requirements
9. Schools / Trusts
   • Schools or educational trusts with proper documentation (such as UDISE certificates for schools) and property ownership or leasehold rights

These entities can apply for an Aerem Solar Loan by providing the necessary documents and meeting the specific eligibility criteria outlined for each category. Aerem ensures that the application process is smooth and tailored to the needs of different business structures and ownership types.

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Eligibility Criteria for an Aerem Solar Loan

1. Borrower’s Age: The proprietor’s minimum age should be 25 years,with a maximum age of 65 at the time of loan maturity.
2. Grid Connection: The solar plant must be grid-connected and have net metering approval from your jurisdictional DISCOM.
3. Property Ownership: The property where the solar plant is to be installed must be owned by you, or you should have leasehold rights covering the loan tenure.

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Steps to Apply for an Aerem Solar Loan

Scenario 1: Application Initiated by Your Selected EPC

1. Comprehensive Technical Assessment: Aerem’s Asset Assurance (AAA)team undertakes an in-depth technical evaluation of the proposal submitted by the chosen Engineering, Procurement, and Construction (EPC) contractor to ensure project feasibility and alignment with industry standards
2. Submission of Loan Application: The applicant is required to submit a complete loan application, including all necessary documentation specific to their entity type, as guided by the application process
3. Proposal Submission by EPC: The EPC’s detailed project proposals are uploaded for further review and consideration
4. Underwriting Process: The application and associated documents undergo a rigorous underwriting process to evaluate financial soundness and project viability
5. Loan Approval Decision: Following the underwriting assessment, a formal decision is made to either approve or reject the loan application
6. Processing Fee Payment: The customer pays a minimal processing fee and accepts the proposal.
7. Agreement Signing: The Customer signs the loan documentations digitally
8. Disbursement of Funds: Upon approval, the loan proceeds are disbursed, enabling the commencement of the solar installation project as outlined in the EPC proposal

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Scenario 2: Direct Engagement with Aerem

1. Initial Contact with Aerem: Prospective borrowers initiate contact with Aerem to explore financing options for their solar project
2. Feasibility Study: Aerem’s technical team conducts a thorough feasibility analysis to determine the practicality and potential success of the proposed solar installation
3. Selection of EPC Contractors: Aerem identifies and engages with 3-4 EPC contractors from the 800+ verified EPCs that are deemed most suitable based on their expertise and track record, ensuring optimal project execution
4. Techno-Commercial Evaluation: Aerem performs a detailed techno-commercial analysis of the proposals submitted by the shortlisted EPC contractors and presents the most favourable option to the customer
5. Customer Authorization: The customer reviews Aerem’s recommendation and provides formal approval to proceed with the selected EPC contractor
6. Documentation Collection: Aerem collects all required documentation from the customer and submits it to the in house NBFC for a comprehensive underwriting
7. Underwriting Process: The application and associated documents undergo a rigorous underwriting process to evaluate financial soundness and project viability
8. Loan Approval Decision: Following the underwriting assessment, a formal decision is made to either approve or reject the loan application. If approved a loan offer in released.
9. Processing Fee Payment: The customer pays a minimal processing fee and accepts the proposal.
10. Agreement Signing: The Customer signs the loan documentations digitally

1. Disbursement of Funds: Upon approval, the loan proceeds are disbursed, enabling the commencement of the solar installation project as outlined in the EPC proposal

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Conclusion

Transitioning to solar energy is a significant decision that can lead to substantial savings on electricity costs while contributing to a more sustainable future. With Aerem Solar Loans, MSMEs, homeowners, and various other entities can overcome the financial barriers typically associated with solar installations. Our tailored financing solutions, strong industry partnerships, and comprehensive support throughout the process ensure that your journey to solar is not only affordable but also seamless and efficient.

By choosing Aerem, you're not just opting for a loan; you're partnering with a company dedicated to empowering your business with renewable energy. Whether you're looking to reduce operational costs, improve energy efficiency, or contribute to environmental sustainability, Aerem Solar Loans offer the perfect solution to meet your unique needs.

Take the first step toward a brighter, greener future with Aerem—your trusted partner in solar energy.

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