What is the difference between repo rate and prime rate?

The repo rate is set by the South African Reserve Bank.

The prime interest rate is the minimum rate at which banks will lend to customers. This will usually be the repo rate + what the banks want to make on profit.

The SARB might adjust the repo rate for a number of reasons. For example, they might lower it to stimulate the economy, as they did during COVID, or they might raise it to try to control inflation.

Homeowners will want to be aware of fluctuations in the interest rate as it affects what they pay on their home loans.