Official Interest Rate Change for Employer Loans

In a further attempt to bring inflation in South Africa within a target range, the South African Reserve Bank has announced a seventh consecutive increase in the repurchase (repo) rate. The repo rate has been increased by a further 75 basis points, effective from 25 November 2022. The repo rate has increased from 6.25% to 7%, setting South African interest rates at their highest levels since 2016.

Since the official interest rate is set at 1% above the current repo rate, it will also increase from 7.25% to 8%, with effect from 1 December 2022. This will impact the fringe benefits calculated on the Employer Loan item on SimplePay, which is fixed to the presiding official interest rate.

SimplePay has already worked our magic to take the increase into account. In line with our ongoing commitments to making your payroll simple and compliant, all employer loan items on payslips will automatically incorporate the new interest rate. Payslips dated before 1 December 2022 will remain unaffected by this change. 

Our Employer Loan items help page can be viewed for any additional information. 

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

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 free trial. Experience payroll the simple way for 30 days! 

Take care,

Team SimplePay