Absa to repay customers after interest rate error

Absa is in the process of paying back millions of rand to credit card customers after it overcharged them with erroneous interest rates.

"Absa can confirm that an internal review uncovered instances of incorrect debit interest related to certain credit card customers who had been in arrears," the bank said in a statement on Tuesday.

Absa said that it has taken action to rectify the "systems calculation error" and was taking steps to apologise to and inform affected customers so that they could be fully reimbursed.

"All affected customers have already been identified and our current focus is on completing the remediation process with affected customers," Absa said.

On Friday Business Day reported that Absa would have to pay back millions of rands to customers and that thousands of customers had been affected.

National Credit Regulator company secretary Lesiba Mashapa told Fin24 that the matter has been reported.

"The NCR requested that Absa submit an audit report confirming the refunds and number of credit products and consumers affected," Mashapa said.

Absa said it had put measures in place to prevent similar errors occurring again and had notified the relevant regulators, including the South African Reserve Bank.