The Scottish Government has announced that used EV buyers in Scotland will now be able to get a loan of up to £20,000, interest free, over five years to cover costs.

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The devolved Scottish government has been offering a Low Carbon Transport Loan (LCTL) since 2011. Available for up to £35,000, interest-free and repaid over six years, they have helped encourage more people into new EVs. Now, Transport for Scotland has extended the scheme to used EVs.

As of September 28, for the first time buyers will be able to purchase a used battery electric vehicle using an extension to the loan programme. Available to businesses and individuals, a LCTL worth up to £20,000 can be taken to cover the initial purchase cost and then repaid over a period of five years.

It's an obvious move for Scotland, which has already provided over £85 million to help people switch to ultra-low emissions vehicles. The government there made the commitment to phase out new petrol and diesel cars by 2032 before the Westminster government started to consider pulling forward the date from its current 2035. Given that the used EV market is buoyant and ever-expanding, extending the loan to that market area will likely significantly increase ownership.

The benefits of the scheme are numerous – beyond the fact that £20,000 will cover the outright cost of a used 30kWh Nissan Leaf, 30kWh Kia Soul EV or BMW i3, among others. Buyers won't have to shell out any of their own money to start with, so the savings they will make on fuel and maintenance will be immediate as well as ongoing. Like any EV buyer, beneficiaries of the LCTL will be able to get a £500 grant to help cover the cost of installing a domestic wall box.

Doing a bit of 'back of a fag packet' maths, any of the EVs we mention above could be bought with monthly repayments of no more than £250. That kind of monthly payment is akin to low-cost leasing, but at the end of the five year period buyers actually have an asset to show for it.

Cabinet Secretary for Transport, Infrastructure and Connectivity Michael Matheson said: “Expanding our Low Carbon Transport Loan will make it easier for more people to access the benefits of modern ultra-low emission vehicles. The global shift towards electric vehicles means that prices are coming down year on year, but the price point for new vehicles remains high for many. We want to make it easier for people to switch by providing interest free finance options for used vehicles.

“Globally, it’s clear that the shift to electric vehicles is becoming inevitable – but no one who requires a vehicle should be left behind from the benefits these modern vehicles can bring, both in terms of running costs and the environmental benefits.”

For those who don't fancy a car, the grant will also cover electric motorcycles (which will feature in Long Way Up on Apple TV+, out this month) and vans.

A buoyant used EV market

Buyers in Scotland who take part in the scheme when it launches at the end of the month will enter a market which is currently skewed in their favour. During the first part of September, Auto Trader found that supply of alternatively fuelled vehicles (AFV) outstripped demand – something which is comparatively rare in the AFV segment of the market where traditionally there are more buyers than cars. This has meant that used AFV prices have fallen by one per cent year-on-year.

Finding a used EV to buy should also prove slightly easier, too, with the UK government's Department for Transport (that is to say, not just Scotland) working closely with Auto Trader – as the UK's biggest car buying site – to develop a dedicated EV section on the company's website. The DfT's goal is to educate and help bust EV ownership myths at the critical research stage of the buying process. It won't just be Auto Trader, with the DfT expecting to work with a 'surge in similar sites' in the coming years.

Auto Trader Director, Ian Plummer, said: “In a bid to help consumers and alleviate some of their concerns, we have relaunched our electric vehicle hub with new editorial content and improved search functionality. Improved search filters for things like battery range and charging time... helps make buying an electric vehicle easier.”

Discover EV's take

The Scottish LCTL is a scheme which has no losers and one which we'd love to see extended to the rest of the UK. Consumers get access to zero-emissions vehicles they otherwise may not be able to afford and the exchequer knows that it'll get its money back at the end of it. The used EV market is only going to get more competitive as an increasing number of three-year-old ex-PCP, HP and lease EVs come up for sale. What we would advise is that if you're in that market, don't just rely on AutoTrader; get your information from a range of sources (starting with Discoverev.co.uk, of course) – especially experienced journalists – as they will tell you the things that a profit-driven, car buying portal won't.