The United States has ambitious plans for electric vehicle adoption, having set a target for EVs to make up half of all U.S. car sales by 2030. There’s a long way to go on that front. Fully electric vehicle sales made up only 6% of overall sales during the 2022 third quarter, according to data from CleanTechnica.

One of the keys to the wider adoption of EVs is making them more affordable for consumers, both in terms of the purchase price and loan terms. The average sticker price of a new EV in 2021 was about $10,000 higher than the industry average, according to the National Resources Defense Council. That gap should shrink considerably as manufacturers produce more affordable models and batteries.

Loans are a different story. With interest rates rising in 2022 due to a series of Federal Reserve hikes, borrowing costs are the highest they’ve been in many years. EV loans are especially tricky because the vehicles command such high prices.

But some people argue that conventional EV loans overlook critical financial considerations that would otherwise open the market up to more buyers. One of those people is Alex Liegl, co-founder and CEO of Tenet, a Silicon Valley EV fintech startup. His company compiles data that aims to prove that EV buyers are lower credit risks than other car buyers, which could lead to better loan terms for consumers and broader adoption.

​“The more data we’re able to collect, the more efficiently we’re able to price our consumer loans, and the more savings we’re able to pass on,” said Liegl in a recent interview with Canary Media.

One thing Tenet is out to prove is that most U.S. car buyers aren’t getting a fair shake on EV loans. That’s partly because the loans don’t consider the federal tax credits and state and utility incentives consumers get when they purchase EVs. Such perks soften the long-term financial blow, making it easier to make monthly payments. 

EV drivers realize further savings by not having to purchase gasoline – a huge perk now, with gas prices near record highs. Electric vehicles are also cheaper to maintain than gas-powered cars. In addition, EVs tend to have higher resale values, which means lenders have greater collateral to fall back on in the event of defaulted loans.

Even with these advantages, many consumers are still priced out of the EV market.

Tenet’s mission is to ease the upfront costs of EV ownership. 

The company doesn’t carry loans on its own balance sheet but instead earns its money from banks, credit unions, automakers, dealers, and other financing partners that use its data to ​“connect the dots and align those incentives.” Liegl said.

Tenet says its EV loan offering cuts monthly payments by about $150 on average compared to conventional EV loans. As TechCrunch reported, Tenet can’t lower an EV’s sticker price, so potential buyers must still be able to afford one. But cutting the upfront price with better loan terms should increase the number of potential buyers.

“Tenet exclusively works with sustainability and ESG-focused institutional investors and capital markets,” CEO Alex Liegl told TechCrunch. This gives the company access to cheaper cost-of-capital, which it can then pass on to consumers at lower rates.

Tenet was founded in 2021 and kicked off with $18 million in seed funding led by San Francisco-based Human Capital and London-based Giant Ventures. The startup has since signed deals with numerous automotive and financing partners. In October 2022, Tenet secured a $20 million debt facility from Silicon Valley Bank, allowing it to generate up to $20 million in EV loans per month.

The company is active in over 30 states and has enabled several thousand loans. Its goal is to help finance at least 10,000 EVs by the end of 2023. In addition to helping lower borrowing costs, Tenet has partnered with fellow Silicon Valley startup Treehouse to streamline the process of installing EV chargers at customers’ homes.

Like Tenet, Treehouse has developed a data-driven approach to bundling the cost of buying and installing EV chargers at home. The two companies plan to bundle the cost of charger installation into EV loans in early 2023.