29 percent of Denmark’s CO2 emissions originate from domestic transport. Therefore, a gradual replacement towards more climate-friendly cars is an important part of achieving the country’s overall climate target of a 70 percent CO2 emissions reduction by 2030.

To support this ambition, Danish financial institutions have introduced attractive loans on zero- and low-emission vehicles.

At the end of 2020, a political agreement on car taxation was reached, supporting the transition of Danish vehicles to greener alternatives. The political agreement is estimated to increase the number of zero- and low-emission vehicles to 775,000 by 2030.

Both large and small financial institutions have developed a wide range of different types of car loans for these vehicles which customers can choose from when they need to finance a new electric car.

The introduction of these preferential terms for green car loans has helped accelerate the adoption of electric vehicles. In 2022, Danish banks’ lending for electric cars and other zero- or low-emission cars had increased by 76 percent compared to the previous year and totalled EUR 1.2 billion (USD 1.4 billion).