1. What is the Loan Repayment Formula?

The loan repayment formula calculates the fixed monthly payment required to repay a loan over a specified term. This is the standard formula used by Standard Bank and most financial institutions for personal loans in South Africa.

2. How Does the Calculator Work?

The calculator uses the loan repayment formula:

Where:

• \( P \) — Principal loan amount (ZAR)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Number of monthly payments (loan term in months)
• \( PMT \) — Monthly payment amount (ZAR)

Explanation: The formula accounts for compound interest over the loan term, calculating a fixed payment that covers both principal and interest each month.

3. Importance of Loan Repayment Calculation

Details: Understanding your monthly repayment helps with budgeting and ensures you can comfortably afford the loan before committing. It also allows you to compare different loan offers.

4. Using the Calculator

Tips: Enter the principal amount in ZAR, annual interest rate in percentage, and loan term in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What interest rate does Standard Bank use?
A: Rates vary based on credit profile, loan amount, and term. Current rates typically range from 7.25% to 24.5% per annum.

Q2: Are there other fees besides interest?
A: Standard Bank may charge initiation and service fees. These are not included in this calculation.

Q3: Can I pay off my loan early?
A: Yes, but early settlement fees may apply. Contact Standard Bank for details.

Q4: How accurate is this calculator?
A: This provides an estimate. Your actual payment may differ slightly due to rounding or additional fees.

Q5: What's the maximum loan term?
A: Standard Bank typically offers personal loans with terms from 12 to 72 months.