Official Interest Rate Change for Employer Loans

Recent international events have forced central banks across the world to hike interest rates even further.

Under pressure to keep up with growing interest rate hikes in other countries, the South African Reserve Bank has once again increased the repurchase rate by a further 75 basis points, effective from 22 September 2022. The repurchase rate has increased from 5.5% to 6.25%, bringing interest rates back to pre-pandemic levels. 

Since the official interest rate is set at 1% above the current repurchase rate, it will also increase from 6.5% to 7.25%, with effect from 1 October 2022. This will impact the fringe benefits calculated on the Employer Loan item on SimplePay, which is fixed to the presiding official interest rate.

Staying true to our commitment to making your payroll painlessly simple and keeping your business compliant, SimplePay has already worked our magic to take the increase into account. From 1 October 2022, all employer loan items on payslips will automatically incorporate the new interest rate. Payslips dated before 1 October 2022 will remain unaffected by this change. 

You can find more information on our Employer Loans item on our help page here.

Please feel free to contact us on support@simplepay.co.za, should you have any questions around this, or your SimplePay profile. 

If you are not yet a SimplePay customer, but want to experience seamless payroll regardless of changes in legislation or policy, we recommend signing up for a trial here. Experience payroll the simple way, free for 30 days! 

Take care,

Team SimplePay