Part 3 of 8 · Pricing
SEDFA Interest Rates: What the Money Actually Costs
SEDFA does not publish one rate. Pricing depends on the programme, your risk profile and whether the rate is fixed or linked to prime. To read any quoted rate you first need to know what prime is.
Section 4Prime, and why it moves
Prime is the benchmark South African banks quote against. It is set at the South African Reserve Bank repo rate plus 3.5 percentage points. Following the SARB’s 25 basis point increase on 28 May 2026 — the first hike since May 2023 — the repo rate is 7.00% and prime is 10.50%.
At prime = 10.50%, with an indicative commercial bank comparison. Standard direct lending is risk-priced, so your margin will depend on your profile and security.
Fixed or floating — the choice matters more than it looks
| Fixed rate | Prime-linked (floating) | |
|---|---|---|
| Used by | TREP (5%), Amavulandlela (prime less 5%, fixed at drawdown) | SEMSP and most standard direct lending |
| If rates rise | Your repayment does not change | Your repayment rises |
| If rates fall | You keep paying the original rate | Your repayment falls |
| Best when | You need certainty to plan cash flow | You believe rates will fall and can absorb a rise |
A worked example: R500 000 over 60 months
The same amount, over the same term, priced four different ways. This is the clearest argument for spending an extra week finding the right programme.
Straight amortisation, excluding fees. The difference between the cheapest and the most expensive route here is more than R124 000 of interest on identical money.
