Maximum interest rates on loans from 6 May 2016

Maximum interest rates and costs applicable to different types of credit transactions – applicable from 6 May 2016	Present repo rate 7%
Mortgage agreements	Repo Rate + 12% per year
Credit facilities	Repo Rate + 14% per year
Unsecured credit transactions	Repo Rate + 21% per year
Developmental credit agreements (i.e. small business, low income housing)	Repo Rate + 27% per year
Short-term transactions	5% per month on the first loan and 3% per month on subsequent loans within a calendar year
Other credit agreements	Repo Rate + 17% per year
Incidental credit agreements	2% per month

Source: Government Gazette, 6 November 2015

Initiation fees on credit agreements are also limited under the regulations.

Credit type	Maximum initiation fee
Mortgage agreements	(a) R1 100 per credit agreement, plus 10% of the amount in excess of R10 000 (b) Never to exceed R5 250
Credit facilities	(a) R165 per credit agreement, plus 10% of the amount in excess of R1 000 (b) Never to exceed R1 050
Unsecured credit transaction	(a) R165 per credit agreement, plus 10% of the amount in excess of R1 000 (b) Never to exceed R1 050
Developmental credit agreements –       for small business development –       for low-income housing	(a) R275 per credit agreement, plus 10% of the amount in excess of R1 000 (b) Never to exceed R2 600 (a) R550 per credit agreement, plus 10% of the amount in excess of R1 000 (b) Never to exceed R2 600
Short-term credit transactions	(a) R165 per credit agreement, plus 10% of the amount in excess of R1 000 (b) Never to exceed R1 050