Two very different products
Bank certificates and participation in a solar asset through pv.direct are often compared, because both are ways to put savings to work. They are built very differently, and each has its own characteristics and risks. This article explains the differences — it does not rank them.
1. Where the return comes from
A bank certificate pays a return that the bank sets in the certificate's terms; current rates are published by each bank. With pv.direct, participants hold a share in a documented solar installation, and distributions come from electricity revenue that the offtaker (for example a factory) actually pays. Projected annual distribution range — not guaranteed. It depends on energy production, customer payment, costs and the contract.
2. Electricity prices and inflation
A certificate's return follows its terms. For a solar asset, the electricity price agreed with the offtaker is set in the project contract; whether it changes when grid tariffs change depends on that contract. Electricity tariffs in Egypt have risen in recent years, but future changes are uncertain. Neither product should be treated as protection against inflation without checking its terms.
3. Risk
A bank certificate is a banking product with terms set by the bank. Participation in a solar asset carries project risks: lower production than expected, late or missing payment by the offtaker, operating and repair costs, contract terms and market conditions. Distributions can be lower than projected.
4. Sharia considerations
Conventional bank certificates are interest-based, and views on them differ — if this matters to you, ask your own religious adviser. pv.direct participation is designed to align with Sharia principles (e.g. Musharakah-style participation in a real asset). Obtain your own advice or certification if required.
5. Exit and liquidity
Bank certificates run for a fixed term; early redemption, where available, follows the bank's terms. At pv.direct, exit requests require at least 6 months notice and follow the project contract and resale process. Capital return uses the agreed formula (original participation minus the annual capital deduction, e.g. 0.5% per year as set in the contract), subject to contract and outstanding obligations. When a share is resold, the factory receives 1% of the transaction value, as set in the contract.
Side by side
| Aspect | pv.direct participation | Bank certificate |
|---|---|---|
| Source of return | Electricity revenue actually paid by the offtaker | Return set by the bank in the certificate terms |
| Return | Projected annual distribution range — not guaranteed | Per the bank's published terms |
| Main risks | Production, offtaker payment, costs, contract and market conditions | Per the bank's terms and conditions |
| Link to electricity tariffs | Depends on the project contract | None |
| Effect of inflation | Real value of distributions depends on inflation and on the contract price | Real value of the return depends on inflation |
| Sharia | Designed to align with Sharia principles — obtain your own advice | Conventional certificates are interest-based |
| Exit | At least 6 months notice; contract and resale process; agreed capital-return formula | Fixed term; early redemption per the bank's terms |
| Underlying | Share in a documented solar installation | Deposit with the bank |
Which one fits you?
There is no answer that fits everyone. It depends on how much certainty you need, your time horizon, how soon you may need the money and your personal Sharia requirements. Read the project contract carefully, ask questions, and get independent financial and religious advice where needed.
Important: Projected figures are illustrative only — not guaranteed. Returns depend on energy production, customer payment, costs, contract terms and market conditions. This article is general information, not investment advice.