Black Sash Media Statements

SASSA's proposed 'hybrid' model options still remains unclear

13 December 2017

The Black Sash acknowledges the commitment by the Inter-Ministerial Committee (IMC) for Comprehensive Social Security and the South African Social Security Agency (SASSA) to phase out Cash Paymaster Services (CPS), Net 1 and its subsidiaries from the national grant payment system by 31 March 2018. We note the Protocol Framework and the Service Agreement signed between the South African Post Office (SAPO) and SASSA as work in progress.

However, we are concerned that the Service Agreement with SAPO states that Cash in transit (CIT) and Guard services  as well as the card disbursement services, applicable to over two million social grant beneficiaries, may be provided by SAPO. At this stage, it is not clear who will provide this service and SASSA could initiate a separate competitive tender for these services. There is a real danger that the CIT tender could take a considerable time to conclude and be implemented. This may even result in the extension of the current CPS SASSA contract.

The SASSA SAPO Agreement provides for the creation of a special disbursement account into which grants will be paid. It is crucial that the functionalities as well as the terms and conditions of this account be included in the Agreement. The account should exclude debit order and any other deductions such as those resulting from USSD platforms (e.g prepaid electricity and airtime). It is essential that government covers the cost of the banking services, so that beneficiaries can receive the full cash value of the grant. The SASSA SAPO Agreement should also include a dispute mechanism so that grant beneficiaries are able to lodge queries if they encounter any problems with their accounts.

The proposed ‘hybrid’ model options still remains unclear. There is no written agreement on the banking product(s) that will be offered by the commercial banks. Like the special disbursement account held by SAPO, the functionalities and terms and conditions of the proposed account must be clearly defined and form part of the Agreement between SASSA and the banks. The Black Sash would like this to explicitly exclude debit orders and other deductions. The bank account(s) should be endorsed by the South African Reserve Bank (SARB). SARB should also play an oversight role and deal decisively with any unethical conduct. Furthermore, grant beneficiaries should not be encouraged to open commercial bank accounts which may expose them to exorbitant cash withdrawal and other banking fees.

EasyPay Everywhere (EPE), better known as the green card, is a bank account operated by Grindrod Bank and the Net 1 subsidiary, Moneyline. Grindrod Bank has no walk-in service branches for the over two million EPE clients, many of whom are grant beneficiaries. Some grant beneficiaries say they switched to the EPE bank account since they were told by agents that it is a SASSA replacement card. In our ongoing community monitoring work, we have discovered that grant beneficiaries with EPE accounts experience a number of suspicious deductions. EPE card holders struggle to dispute these questionable deductions because they do not readily have access to bank statements. Queries and disputes are handled ineffectively via a Net 1 Call Centre, with grant beneficiaries carrying the high telephone costs. We have observed that is almost impossible for beneficiaries to close their EPE accounts and revert back to the ‘SASSA branded’ bank account. The Black Sash wishes to caution against the unilateral transfer of beneficiaries' accounts to EPE. This account seems to be commercially exploitative and offers almost no client support services.

SASSA should rework their communications plan to include more details of the proposed national grant payment system. The protection of grant beneficiaries' Constitutional right to social security and assistance must remain the desired outcome.

For interviews please contact:

Lynette Maart
Black Sash National Director
083 628 3425 / 021 686 6952

Thandiwe Zulu
Black Sash Gauteng Regional Manager
082 456 2643 / 011 834 8361/5