Since the historic lows of the early pandemic, the Repo Rate has slowly been pushed higher and higher.
As the rate climbs, the banks (and other credit providers who offer credit) have been increasing the rate they charge consumers on loans, credit cards, bonds, car finance and overdrafts (note: what they are allowed to charge is linked to the repo rate by law).
Prime Rate now at 11.80%
Read More: What is the Repo Rate?
This means the latest rate hike is going to increase the monthly repayment amounts on all credit accounts*.
For many consumers who have been struggling to cope with the high cost of living and also paying off the debts they already have taken on this is bad news.
As debt repayments go up less and less money becomes available for anything else. Some consumers are thus stick in a loop of using their credit to pay for the essentials each month (like food, data, transport and accommodation).