South African lenders raise EV loan rates

July 15, 2025

From the newsletter 

The average rate on loans from three of South Africa’s major banks to purchase an EV rose from 7.5% in June to 7.54% in July, an analysis by Mobility Rising shows. We analysed rates on EV loans from leading financiers in three major African economies namely South Africa, Kenya and Nigeria. In Kenya and Nigeria, interest rates remained unchanged during the month. 

  • We usually conduct the survey every first week of the month, and our latest findings show that the majority of loans are short-term, with tenures ranging between 12 and 60 months. 

  • Over the last three months, EV loans in all the three countries have been largely stable, with minor adjustments in South Africa. This stability offers buyers predictability in their monthly instalments. 

More details

  • South Africa is Africa’s biggest car market and has a fairly robust financial system, enabling millions of citizens to qualify for financing to purchase vehicles. In our survey, we analysed rates charged by Absa, WesBank and Nedbank.

  • In July, Absa had the lowest rate, charging 5.43%, while WesBank had the second highest rate, charging borrowers 7.39%. At the same time, Nedbank charges the highest rate, rising to 7.83% annually for an electric car loan.  

  • Our analysis shows that in Kenya, rates remained unchanged from May to July. The interest rate charged by M-Kopa for electric motorcycles ranges between 28% and 44% while Watu Credit charges between 32% and 36%. EV buyers can however get lower rates from banks. NCBA charges 18.5% annually, while a loan from KCB costs 18%.    

  • The cost of financing in Nigeria ranges between 32% per year offered by Qoray Mobility and 34% per year offered by The Alternative Bank in July, the same as in May and June. The majority of the loans are payable over a period of 12 months, while some are paid over 18 months.

  • In Kenya, rates on bank loans are expected to go down in the coming months following a decision by the Central Bank of Kenya (CBK) to lower the base lending rate to 9.75% last month. This is the sixth consecutive cut by the apex bank and is expected to be implemented by commercial banks.  

  • Meanwhile, the Central Bank of Nigeria (CBN) has maintained the rate at 27.50%. This marks the second consecutive time the MPC has held the rate steady in 2025. This is expected to result in steady interest rates on EV loans in Nigeria for the foreseeable future. 

Our take

  • With the base lending rate now at 9.75%, Kenya’s commercial banks have room to lower their EV loan rates significantly below the current 18–18.5%. Regulators and policymakers should push for faster transmission of these cuts to consumers to drive EV adoption. 

  • With its relatively lower interest rates, South Africa shows the benefits of a mature financial ecosystem. Other African countries should study its credit frameworks and borrower protections to attract more affordable EV financing. 

  • Nigeria needs targeted incentives to reduce its prohibitively high EV loan rates. At rates of between 32–34% annually, financing is out of reach for most. The Nigerian government should consider interest rate subsidies, credit guarantees, or green finance funds to support more affordable lending.