Warm Homes Loan Scheme Opens to Regulated UK Lenders
The Warm Homes Loans Scheme (WHLS) has opened to lenders across the UK financial services sector, offering government support intended to expand access to affordable finance for low-carbon home improvements.
The initiative is government supported and lender led, forming part of the wider Warm Homes Plan. It aims to support growth in green home finance by unlocking private lending and investment at scale.
Under WHLS, up to £300 million of grant capital is being deployed to participating lenders. The public contribution is provided as a non-repayable Capital Departmental Expenditure Limit (CDEL) grant of up to 20% of the loan amount. The grant is paid in arrears after installation has been verified and is used to reduce the effective principal of eligible loans rather than buying down interest rates directly. This structure is intended to reduce risk and cost for lenders, enabling lower interest rates for consumers.
The scheme is open to banks, building societies, credit unions and specialist green lenders. Applicants must be fully authorised and regulated by the Financial Conduct Authority (FCA) to undertake the relevant lending activities or be actively in the process of obtaining authorisation. Lenders are also expected to demonstrate sufficient financial and operational capability to design, launch and administer consumer loan products at scale, with established systems for customer servicing, regulatory reporting and complaints handling.
Loans supported can be used for the purchase and installation of eligible low-carbon upgrades, including heat pumps, solar PV panels, electrical storage batteries, biomass boilers for rural homes not connected to the gas grid, heat network connections and micro-renewables such as micro-wind or micro-hydroelectric systems. Loan caps include £15,000 for solar PV and batteries, up to £35,000 for ground source heat pumps and £20,000 for biomass boilers, with some caps set before any Boiler Upgrade Scheme grant deduction.
The deadline for applications is 17 July 2026 (17:00).
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