Official Interest Rate Change for Employer Loans - 26 May 2023

The South African Reserve Bank has announced yet another increase in the repurchase (repo) rate, marking this as the 10th consecutive hike since November 2021. The repo rate has been increased by a further 50 basis points, effective from 26 May 2023.  The repo rate will increase from 7.75% to 8.25%, in an attempt to alleviate persistent inflation.

As the official interest rate is set at 1% above the current repo rate, the interest rate will increase from 8.75% to 9.25%, effective from 1 June 2023. This increase will impact the fringe benefits calculated on any Employer Loan item on SimplePay, which is linked to the presiding official interest rate.

SimplePay has already made the necessary changes to take the increase into account. In line with our ongoing commitment to making your payroll simple and compliant, all Employer Loan items on payslips from 1 June 2023 will automatically incorporate the new interest rate. Payslips dated before this date will remain unaffected by this change. 

If you need help setting up our Employer Loan items, you can visit our help page for guidance and 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 simple and compliant payroll, we recommend signing up for a free trial. Experience payroll the simple way for 30 days! 

Take care,

Team SimplePay