First National Bank (FNB) will reduce its prime lending rate by 0.25% following the decision taken earlier today by the South African Reserve Bank Monetary Policy Committee to lower its benchmark repo rate by 0.25%. FNB will adjust its rates on prime-linked accounts with effect from Friday 1 August 2025.
“The Reserve Bank’s decision to cut interest rates by 25 basis points is a timely and strategic move aimed at supporting households and businesses. This decision will help soften some of the impact of tariffs on the economy. We do expect certain sectors will be adversely affected by the new tariffs, but this does not fully erode the good growth momentum across the economy as we expect see real growth for 2025 to better than 2024 and this should continue into next year,” says FNB CEO Harry Kellan.
Kellan notes that the rate cut will provide immediate relief to consumers and businesses by lowering the cost of borrowing. “Key sectors of the economy such as construction, retail and manufacturing have shown early signs of slowing. Today’s rate cut sets out to stabilise and reverse these trends by increasing affordability of credit and encouraging investment. Encouragingly, our inflation outlook remains benign and, while we’ve seen a sustained period of uninterrupted electricity supply, we’re certain that this will yield cumulative, positive results for consumers and businesses.”
He added that consumers could both reduce costs and improve the efficiency of their banking services by using the wide range of services available on the FNB Banking App and the bank’s Nav channel. For consumers dependant on a fixed income, this approach is even more valuable.
FNB Chief Economist Mamello Matikinca-Ngwenya says, “While we expected the MPC to reflect more restraint amid a contentious global trade environment that could intermittently weigh on sentiment, lift the cost of borrowing, and weaken the rand, today’s decision is not a surprise. It highlights the MPC’s focus on stable domestic conditions”
“Despite adverse global conditions and rising local inflation, as positive base effects fade and food price pressures mount, headline inflation over the coming months should remain contained around the 4.5% midpoint of the target range. The trajectory is supported by weak oil prices, along with benign local environment, these factors should assist with containing inflation expectations and maintaining interest rates as we think this is the last cut in this cycle. Ambitions to lower the inflation target should keep monetary policy steady,” added Matikinca-Ngwenya.
Consumer Information
FNB offers assistance in the form of a Debt Remedy facility from FNB Home Loans, and a Special Repayment Arrangement offered by FNB Card. FNB’s Investment Product House conducts weekly rates review meetings at which rates earned on non-prime linked investments are reviewed independently of the SARB’s MPC announcements. Revised rates are communicated via rates boards in branches and on FNB’s web site, www.fnb.co.za.
