P
Banking
Prime Lending Rate
The benchmark rate SA banks use to price loans — sitting at repo plus 3.5%. When SARB moves the repo, prime follows. If your loan is variable, this number matters to you every month. All the big banks watch this like load shedding updates.
Usage Examples
"Prime is currently at 11.5% (repo 8% plus 3.5% margin). Bongani's FNB home loan is at prime minus 0.5%, so he pays 11%. When repo changes, so does his rate."
"Nomsa's Absa personal loan is priced at prime plus 2%. That's 13.5% currently. When SARB hikes the repo to 8.5%, her rate jumps to 14%. Her monthly payment goes up R240."
"Andile locked in a fixed rate at Standard Bank — 8.5% for the full term. His mate got prime minus 1% which was cheaper at the time, but when rates went up, Andile stayed at 8.5% and his chommie went to 11%. Andile won."