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Repo Rate Cut Again

The South African Reserve Bank (SARB) has finally cut interest rates, bringing the repo rate down by 0.25% to 7.25%.

This is the fourth rate cut since September 2024 and a welcome sign for consumers and businesses alike. The prime lending rate, which banks use to set loan interest, now stands at 10.75%. While it’s not a huge drop, it’s the clearest sign yet that borrowing costs are starting to ease.

Inflation Remains Low

This shift comes after inflation (the rate at which the price of things in South Africa goes up) has come under control.

For a long time the SARB has said they want to see local inflation sitting between 3% and 6%.  Back in July 2022, inflation was at a painful 7.8%, pushing up the cost of food, fuel, and just about everything else.

But since then, it’s been slowly dropping, hitting a low of 2.7% in March 2025. As a result, the Reserve Bank slowly started to lower interest rates, offering a little relief to households and the economy. When rates drop and people do not have to use as much money to service their debts then they can rather spend that extra few rand at the shops or restaurants, which helps those businesses be more profitable.

It's Nice But…

For those with large debts like bonds or vehicle finance, this cut may ease some pressure on monthly repayments.

When you are stretched to the max even a small drop in interest can make a difference, and it will definitely make a difference over time.

But if you’re still feeling overwhelmed by debt, don’t wait for another rate cut, please speak to a NCR registered Debt Counsellor ASAP.

They can help you put a plan in place, reduce stress, and take back control of your finances. Under debt review, many people enjoy rate reductions of even as low as 0% on unsecured loans or prime on assets.