May 27, 2024
Finance News

Increased Repo rate, what does it mean for you.

repo rate

South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) decision to increase the repo rate by 50 basis points to 4.75% – taking the prime rate to 8.25%, what does this mean to South Africans?

Here is what increased repo rate mean for the poor and working class South African citizens, in simple terms increased repo rate means borrowing prices (interests) will increase, South African citizens who have home loans, vehicle loans and other credits with the banks will have to pay more than they initially expected to pay.

With already fuel prices and food prices soaring up, an increased repo rate will have negative impact on all South African not only South Africans who have bank credits, with employers having to pay more, this means that food prices and transport prices are also likely to go up, above what we are already paying.

Members of the public are set to be affected in terms of borrowing money, some members might find it hard to qualify for loans with the rate having increased. It is advisible for South Africans to think twice before borrowing money from banks, or money lending institutions.

South African Reserve Bank blamed the increase on electricity (Eskom) and fuel price increases stating that this left them with no choice but to increase the repo rate.