Since January, UK Finance has been a leading member of the Green Home Finance Strategic Partnership. Chaired by the government and the Green Finance Institute (GFI), this initiative brings together lenders, energy providers, and consumer groups to develop practical recommendations to scale green home finance and support households more affordably finance green upgrades, like solar, heat pumps, and batteries. 

Why is UK Finance involved and what role are we playing?

Supporting the transition to a greener, more energy-efficient housing stock has long been a priority for UK Finance. For some of our members, mortgage portfolios account for 80-90% of their financed emissions - making home decarbonisation essential for meeting corporate net zero targets. Green upgrades also offer lenders an opportunity to help customers improve the comfort of their homes and reduce their energy bills.

UK Finance has two complementary roles within the Partnership. First, our Chief Executive, David Postings, sits on its Steering Group which provides strategic direction and oversight to the work of the Partnership. Alongside this, we also chair Working Group 1, which has been tasked with identifying which green retail finance products have the greatest growth potential and can best serve different segments of the consumer market.  

Together with experts from the lender community, the energy sector, consumer groups and others, the working group has gathered extensive evidence to identify barriers to scale across four product types: point-of-sale finance, subscription models, salary sacrifice, and green mortgages. In the coming months, it will develop a set of practical recommendations for government, regulators, and industry designed to help scale the market and offer more support to consumers. 

What have we found so far?

There are three initial findings from our work to date. 

First, there are a huge number of financial products on the market currently. In the UK, consumers can choose between green additional borrowing products, point-of-sale finance, subscription-based models, and more. According to the GFI, the number of unsecured green home loans has tripled over the past three years. Internationally, the range is even broader, with examples such as Property Linked Finance, which has been deployed in the U.S., Canada, Australia, and South Africa. 

Second, there is no single solution that will meet every household’s needs. Owner-occupiers and landlords each have their own unique motivations, financial circumstances, property types, and preferences. Finance products and customer journeys must reflect that diversity, supported by clear, trusted information on costs, benefits, financial support available, and the suitability of different technologies. Here, the challenge is not simply product innovation, but identifying which products can best serve different households – and what policy, regulatory and economic conditions would make them commercially sustainable for lenders and compelling for consumers. 

Third, finance alone cannot unlock green home upgrades at the pace and scale required. As we set out in our 2025 Greening Homes, Creating Growth report, trusted advice, robust protections, skilled supply chains and greater public understanding of retrofit are essential pre-conditions to create consumer demand for green upgrades. This now depends on the successful delivery of the Warm Homes Plan (see UK Finance’s blog on the Plan).

What are we doing next?

UK Finance looks forward to continuing its work with the government, the GFI, and representatives from the lending, energy and consumer advice community. 

The next phase of our work on the Strategic Partnership will focus on refining the evidence and translating our findings into a practical action plan that can help establish a sustainable, inclusive and scalable green home finance market.