A fresh take: it’s time to future-proof your finances

In a welcome move for households and businesses alike, the South African Reserve Bank (SARB) has officially reduced the repo rate by 25 basis points on 29 May 2025, lowering it from 7.50% to 7.25%. This decision follows sustained declines in inflation and reflects growing but cautious optimism about South Africa’s economic trajectory for the remainder of the year.

Rate cuts to empower consumers

While traditional analyses focus on macroeconomic indicators, this rate cut offers a unique opportunity for consumers to reassess their financial strategies. Lower interest rates reduce the cost of borrowing, making it an opportune time for consumers to consolidate debt, refinance loans or invest in property.
Rather than viewing this rate cut as merely a relief from high repayments, South Africans can seize this moment as an opportunity to build financial resilience. Lower interest rates create breathing room, and what you do with that space can shape your future wealth.

Refinance, restructure, reclaim control

If you have home, vehicle, or personal loans, now is the ideal time to review all your loan repayments. The reduced rate immediately translates into lower monthly instalments across all your debt. Instead of simply enjoying the extra cash, consumers can use this moment to:

  • Pay off loans faster by keeping your repayments at the previous level across all your existing debt. A quick call to the home loan division of your bank, for example, is all it takes to action this.
  • Refinance high-interest debt like credit cards or store accounts into more manageable, lower interest products. Check the interest you’re paying on all your individual debt and make sure you’re paying the most expensive debt off as quickly as possible (while not incurring more in the case of store credit for example).
  • If you feel like you have your debt under control, calculate what this rate cut saves you and build a buffer by redirecting this amount as savings into an emergency fund.

First-time buyers: step into the market

With the cost of borrowing reduced, the property market becomes more accessible, especially for first-time buyers. The property sector stands to gain from this rate cut. Lower borrowing costs can invigorate the market, leading to increased demand and potentially boosting property values. Regions like Gauteng and Mpumalanga, which have experienced subdued growth, may witness heightened activity, while coastal areas facing stock shortages could see price growth upwards of 15%.

Lenders may be more flexible, and repayments become slightly less daunting. For aspiring homeowners who’ve been sitting on the fence, this rate cut could be the green light they’ve been waiting for. If you’re one of those, make sure you have a good idea of where your money is going every month. Speak to a Get Go Home Loans Specialist about calculating your affordability and doing a pre-approval. It is an essential step towards your homeownership journey. A pre-approval from GetGo Home Loans takes your current financial situation into account to calculate how much additional debt you can realistically take on to finance a new home.

This will guide your house-hunting journey to ensure you look at homes you can truly afford, and it makes you look like a more serious buyer in the eyes of both agents and sellers.

A boost for young professionals and side-hustlers

A lesser discussed but powerful upside of lower rates is the potential for investing in yourself. Whether you’re launching a side hustle, returning to study, or upgrading your equipment, cheaper credit means your start-up or upskilling journey may now be more affordable. With South Africa’s booming gig economy, this is a golden window for enterprising minds to take calculated financial steps.

Confidence breeds activity

Lower rates often increase consumer confidence, which translates into more spending, business growth and job creation. Economists will all agree that this is the macroeconomic intention of a rate cut, and our economy needs some urgent stimulation.

This creates a psychological shift for consumers and businesses alike, knowing that the central bank sees enough stability to ease rates, and this goes a long way to energize both households and SMEs, giving the South African economy the boost it needs.

Your financial springboard towards financial freedom

Rather than a temporary reprieve, this rate cut should be seen as a strategic launchpad. As Reserve Bank Governor, Lesetja Kganyago, reiterated the decision is not just about stimulating spending but also about encouraging responsible financial planning. Consumers who use this period to reduce debt and boost savings will be better equipped when the cycle turns again.

This reduction by 25 basis points is more than a technical tweak, it’s a reset moment. South Africans now have a rare chance to shift from financial survival to long-term strategy. Whether you’re buying a home, growing a business, or simply trying to make your money work harder, this is your moment to act smart, not just feel relieved. Read more about being a smart first-time homebuyer.