Official Interest Rate Change for Employers Loans

Fuelled by spiking global inflation, the South African Reserve Bank has hiked the repurchase rate yet again by 50 basis points. With effect from 20 May 2022, the repurchase rate will increase from 4.25% to 4.75%, marking this as the steepest increase since 2016.

As the official interest rate is set at 1% above the current repurchase rate, it will increase from 5.25% to 5.75 with effect from 1 June 2022. This will impact the fringe benefits calculated on employer loans, which are pegged to the presiding official interest rate.

Staying true to our commitment to making your payroll a breeze and keeping your business compliant, we have already updated our system to take the increase into account. From 1 June 2022, all employer loan items on payslips will automatically incorporate the new interest rate. Payslips dated before 1 June 2022 will remain unaffected. 

You can find more information on employer loans on our help page here.

If you have any queries regarding SimplePay or any of our services, please feel free to contact us on support@simplepay.co.za. 

Not yet a SimplePay client but want to experience seamless payroll no matter what changes in legislation or policy occur? The good news is that we offer a 30-day free trial and sign up is a breeze! You can find out more and sign up for a trial here. 

Team SimplePay