Vehicle Finance Calculator South Africa.

How car finance repayments are worked out

Car finance in South Africa is usually an instalment agreement under the National Credit Act: the price is deferred and paid periodically, you get possession, and ownership passes at the end (or passes now subject to the lender's right to repossess).⁴⁵ It is a credit transaction, so the Act's cost-of-credit rules apply.⁶

The monthly instalment is a standard reducing-balance (annuity) calculation:

1. Amount financed (P) = vehicle price (incl. VAT, as you enter it) + extras − deposit or trade-in (+ initiation fee if you capitalise it).
2. Monthly rate (r) = annual interest rate ÷ 12.
3. Term (n) = number of months.
4. Balloon (B) = residual amount left unpaid during the term (can be R0).

Formula used by this calculator:

Instalment = (P − B ÷ (1 + r)^n) × r ÷ (1 − (1 + r)^−n)

Then add the monthly service fee as a separate line on top.

Balloon timing (this calculator's convention): it assumes the balloon is paid at the end of the term, together with the last instalment, not instead of it. If your lender collects the balloon later, the instalment and the interest will differ from what this page shows.¹⁵

A deposit or trade-in lowers P. A balloon lowers the instalment by leaving capital unpaid until the end, which usually means more interest over the same term.

Balloon payments: lower instalments, more interest

A balloon (sometimes called a residual) is a lump sum left unpaid during the term and due at the end. It is not a defined National Credit Act term in the sources we checked — it is a contract feature lenders offer.

Worked example (excludes fees; engine figures):¹²

The calculator's "Total paid" line is a different figure. It also counts your deposit, fees and any insurance you enter, so it is higher than the instalments-plus-balloon line above.

The balloon cuts the instalment by R770.30 a month, but adds R24 538.32 of interest over the term. At the end you still owe the R80 000.

End-of-term options (generic): pay the balloon from savings, refinance it, or sell/trade the vehicle and use the proceeds. Your contract and lender decide what is allowed — this page does not advise which option to take.

Slider ranges on the calculator (term 12–96 months, balloon 0–40% of price) are UX choices, not legal maxima. We found no legal maximum term or balloon percentage in the NCA sources we read.¹⁶

Interest rates: prime, your margin, and the legal maximum

Vehicle finance is commonly priced off prime.³ Prime today is 10.75%, which is the SARB policy rate (repo rate) of 7.25% plus 3.5 percentage points, effective 25 September 2026.¹² The next SARB interest rate announcement is on 19 November 2026.²

Prime and policy rate effective 25 September 2026.¹² The cap is worked out from the regulation and the current repo rate.⁷

The National Credit Regulator classifies motor-vehicle accounts under "Other credit agreements" (secured credit other than mortgages and credit facilities).¹⁰ For that category, regulation 42 Table A caps interest at RR + 17% per year, where RR is "the ruling SA Reserve Bank Repurchase Rate".⁷⁹ At a 7.25% repo rate that is 24.25% a year.

If you enter a rate above that maximum, the calculator shows a neutral warning with a link to the gazette. It does not say your quote is illegal — only that it is above the published maximum for this credit type. Check your pre-agreement quote with your lender.

Rate sensitivity (engine): R300 000 over 72 months with no balloon or fees: R5 633.69 a month at 10.50% vs R5 671.88 at 10.75% (+R38.19 a month).¹²

Fees the law allows: initiation fee and monthly service fee

Under section 101 of the National Credit Act, a credit agreement may only require the principal debt, an initiation fee, a service fee, interest, credit insurance, default administration charges and collection costs.⁶

These fee caps come from GN R1080 (Government Gazette 39379, 6 November 2015) and apply to agreements entered into on or after 6 May 2016.⁷⁸ We found no gazetted amendment to regulation 42 Table A/B or regulation 44 as of 7 November 2026.¹⁴

Initiation fee (other credit agreements)

Formula: R165 + 10% of the amount above R1 000, never more than R1 050.⁷ The amount of the agreement is the amount deferred.⁹ The NCR also notes that an initiation fee may never exceed 15% of the principal debt. That does not bite at car-sized loans. So any amount financed above about R9 850 hits the R1 050 cap (working: 165 + 0.1 × (9 850 − 1 000) = 1 050).

An initiation fee may only be charged when a new credit agreement is set up — not on a transactional basis where there is no new agreement.⁷

VAT on the initiation fee cap: the regulations do not say whether the R1 050 includes VAT. In practice, lenders such as MFC list R1 207.50, which is R1 050 plus 15% VAT, so the calculator prefills that figure.¹³

Monthly service fee

Maximum: R60 a month, covering admin costs such as rent, labour, banking and processing.⁷ It is charged per calendar month and pro rata in the month the agreement starts.⁷

VAT: the regulation itself states R60 with no VAT wording. NCR guidance in its January 2019 release says the service fee "must not exceed R60 excluding VAT".¹¹ At 15% VAT that is R69, the figure lenders such as MFC list and the calculator prefills.¹³

Fee example on the worked deal (at the regulation caps, before VAT): initiation fee R1 050 plus service fees of R60 × 72 = R4 320. Tick "add to loan" or "pay upfront" for the initiation fee in the calculator.

What this calculator doesn't include

• Licence, registration, transfer and dealer/on-the-road fees (they vary by province and dealer) — unless you add them under extras.
• Comprehensive insurance and credit life — optional user-entered extras only; no default amount and no claim that either is compulsory.
• Any bank's advertised or deal rate.
• Approval, affordability or credit scoring.

Estimate only. Your lender sets your rate, fees and approval. Check your pre-agreement quote. This page is not credit advice and Accounter is not quoting as an NCR-registered credit provider.

FAQ

1. How is a car finance instalment calculated in South Africa?

Take the amount financed (price + extras − deposit), pick an annual rate and a term in months, and optionally a balloon. The instalment is the standard annuity formula: (P − B ÷ (1 + r)^n) × r ÷ (1 − (1 + r)^−n), where r is the monthly rate. Add the monthly service fee on top. This calculator uses that method and states its balloon timing in the results.

2. What is a balloon payment and is it a good idea?

A balloon is a lump sum left unpaid during the term and due at the end. It lowers the monthly instalment but usually increases total interest, and you still owe the lump sum. Whether it suits you depends on your cash flow and end-of-term plan — this page shows the numbers only; it does not advise you to take or avoid a balloon.

3. What is the maximum interest rate on vehicle finance?

For "other credit agreements" (the category that includes motor-vehicle accounts), regulation 42 Table A caps interest at the ruling SA Reserve Bank Repurchase Rate (repo / SARB policy rate) plus 17% a year. At a 7.25% repo rate that is 24.25% a year.⁷¹⁰

4. What is the maximum initiation fee on car finance?

For other credit agreements: R165 plus 10% of the amount above R1 000, never more than R1 050.⁷ It may only be charged on a new credit agreement. The regulations don't say whether the R1 050 includes VAT, but lenders such as MFC list R1 207.50, which is R1 050 plus 15% VAT.¹³

5. What monthly service fee can a lender charge?

The maximum monthly service fee is R60, charged per calendar month and pro rata in the first month.⁷ The regulation itself states R60 with no VAT wording. NCR guidance in its January 2019 release says R60 excluding VAT.¹¹ Lenders such as MFC list R69, which is R60 plus 15% VAT.¹³

6. Is car finance linked to prime? What happens when prime goes up?

Vehicle finance is commonly priced as prime plus or minus a margin.³ When the SARB changes the policy rate, prime usually moves by the same amount from the same date, and a prime-linked car rate moves with it. Example: R300 000 over 72 months rises by about R38.19 a month when the rate moves from 10.50% to 10.75%.¹²

7. What does the calculator leave out?

Licence, registration, transfer and dealer fees, and insurance or credit life unless you enter them. It also can't approve a deal or promise a rate — your lender does that.

8. Who regulates car finance?

The National Credit Regulator under the National Credit Act. Complaints about credit providers go to the NCR. Use the complaints details on the NCR website.

Where your money goes (illustrative)

Stacked comparison of capital, interest, fees and balloon for the worked example with and without a 20% balloon. The balloon is part of the capital, not an extra cost. Interest figures come from the engine; fees are shown at the regulatory caps before initiation VAT.

Related

• Prime rate in South Africa today
• Loan calculator
• Bond repayment calculator
• What is amortisation?
• VAT calculator
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• Company car tax calculator
• Bank statement extraction for loan applications
• Transport loan calculators
• Personal finance topics

Sources

1. South African Reserve Bank, Current market rates (prime lending rate and SARB policy rate). API observation 6 November 2026: prime 10.75%, SARB policy rate 7.25%. https://www.resbank.co.za/en/home/what-we-do/statistics/key-statistics/current-market-rates https://custom.resbank.co.za/SarbWebApi/WebIndicators/CurrentMarketRates
2. South African Reserve Bank, Statement of the Monetary Policy Committee, September 2026 (policy rate to 7.25% effective from 25 September; next announcement 19 November 2026). https://www.resbank.co.za/en/home/publications/publication-detail-pages/statements/monetary-policy-statements/2026/september
3. South African Reserve Bank, Consultation paper on the cessation of the prime lending rate, February 2026 (prime used in vehicle finance; proposal only). https://www.resbank.co.za/content/dam/sarb/publications/other-publications/2026/prime/prime-consultation-paper.pdf
4. National Credit Act 34 of 2005, s1 definition of "instalment agreement". https://www.acts.co.za/national-credit-/1__definitions
5. National Credit Act 34 of 2005, s8(4)(c) (instalment agreement is a credit transaction). https://www.acts.co.za/national-credit-/8__credit_agreements
6. National Credit Act 34 of 2005, s101 (cost of credit). https://www.acts.co.za/national-credit-/101__cost_of_credit
7. GN R1080, Government Gazette 39379, 6 November 2015 — Review of Limitations on Fees and Interest Rates Regulations: reg 42 Table A (max interest, other credit RR + 17%), Table B (max initiation fee for other credit agreements: R165 + 10% above R1 000, never more than R1 050), reg 43 (initiation fee only on a new agreement), reg 44 (max monthly service fee R60; pro rata first month). https://www.gov.za/sites/default/files/gcis_document/201511/39379gon1080.pdf
8. National Credit Regulator media release on the effective date of the reviewed caps: in force from 6 May 2016 for agreements entered into on or after that date. https://www.ncr.org.za/documents/Limitation-on-fees-and-interest-rates.pdf
9. Consolidated National Credit Regulations reg 42 and reg 44 (acts.co.za secondary consolidation; gazette N4 is primary). https://www.acts.co.za/national-credit/r489_42__maximum_prescribed_interest_and_initiation_fees https://www.acts.co.za/national-credit/r489_44__maximum_service_fee.php
10. National Credit Regulator, Consumer Credit Market Report Q1 2025: "Other credit agreements" includes motor vehicle accounts. https://www.ncr.org.za/documents/CCMR/CCMR_Q1%202025.pdf
11. NCR media release "If you have to borrow, borrow wisely!" (January 2019): service fee "must not exceed R60 excluding VAT". Also SAnews (GCIS), 22 January 2019. https://www.ncr.org.za/documents/Borrow%20Wisely%202019.pdf https://www.sanews.gov.za/south-africa/be-wise-about-borrowing
12. Worked instalment, balloon and rate-sensitivity figures: standard annuity formula, calculated by the calculator engine.
13. GN R1080 is silent on whether the initiation fee cap includes VAT. MFC lists a R1,207.50 once-off initiation fee and a R69.00 monthly administration fee. MFC does not state the VAT position; the match to the caps plus 15% is our arithmetic. https://www.mfc.co.za/mfc-fees
14. We found no gazetted amendment to reg 42/44 as of 7 November 2026. Not finding one is not proof that none exists.
15. Balloon timing convention: this page assumes the balloon is paid at the end of the term, with the last instalment. Lenders may collect it differently.
16. No legal maximum term or balloon percentage found in the NCA sources read. Slider ranges are UX only.

This page is an estimate only. It isn't financial or credit advice. Your lender sets your rate, fees and approval; check your pre-agreement quote.