The Prime Rate Today
The prime lending rate is 10.75%, since 25 September 2026. It sits 3.5 points above the South African Reserve Bank's repo rate, so when the Reserve Bank moves the repo rate, prime moves the same day. This page reads prime from the Reserve Bank every day, so every figure below follows it.
Banks price car finance against prime. Your agreement will say something like "prime plus 1.5%" or "prime minus 0.5%". That margin is set for you, and it stays the same for the life of the deal.
What Decides the Rate a Bank Offers You
- Your credit record: how you have paid your accounts, and any judgments, defaults or arrears
- Your deposit: the more you put down, the less the bank risks
- The car: its age, mileage and how well it holds its value
- The term: longer terms often carry a higher rate
- A balloon payment, which leaves more owing for longer
- Your income and how much of it is already going to debt
- The bank itself: each one prices risk differently
Because each bank weighs these differently, the same person can get quite different offers. That is why it pays to compare. Carfin sends one application to the top banks at the same time, with one credit enquiry on your record, and a consultant negotiates the offers.
What Each Point Costs on a Typical Car
The same R300,000 financed over 72 months, with no balloon, at different margins above or below prime:
| Rate | Rate a year | Instalment | Total interest |
|---|---|---|---|
| Prime minus 1 | 9.75% | R5,520 a month | R97,440 |
| Prime | 10.75% | R5,672 a month | R108,376 |
| Prime plus 1 | 11.75% | R5,826 a month | R119,481 |
| Prime plus 2 | 12.75% | R5,983 a month | R130,756 |
| Prime plus 3 | 13.75% | R6,142 a month | R142,198 |
| Prime plus 5 | 15.75% | R6,466 a month | R165,576 |
The margins are a spread for illustration, not the rates a bank offers any particular profile. Bank fees and insurance are not included. These are examples, not quotes. Check any row in the car finance calculator.
Going from prime plus one to prime plus three adds R316 a month and R22,716 over the term. On a linked rate, a single 0.25 point move by the Reserve Bank changes the instalment by about R39 a month.
Fixed or Linked Rate?
- Linked. Your rate is prime plus or minus your margin, so the instalment rises and falls with prime.
- Fixed. The rate is set on the day you sign and does not change. You know your instalment for the whole term, but the fixed rate is usually higher than the linked one to start with.
A fixed rate suits a tight budget that could not take an increase. A linked rate gains when rates fall and loses when they rise.
How to Get a Better Rate
- Clean up your credit record first. Bring accounts up to date and settle anything in arrears. See what credit score you need.
- Put down a deposit. Even 10% can improve the offer.
- Choose a shorter term if the instalment allows it.
- Let several banks compete. One application through Carfin reaches the top banks at once.
