Sassa Clients Failed by Post Office Results in Penalty

The termination of the South African Post Office’s contract to pay out social grants has left the agency facing the consequences of its failure to deliver services. The contractual agreement between the agency and the Post Office stipulated that there must be a seamless transition from the Post Office to the payment of social grants without interruption. However, due to the Post Office’s inability to provide adequate services, the contract was terminated to ensure that the payment schedule of social grants returned to normal.

Grant beneficiaries were advised to withdraw their funds from retailers and ATMs after the Postbank took over from the Post Office. Sassa’s Executive Manager of Grants Administration, Brenton van Vrede, stated that the Post Office was penalized 5% of their invoice for failing to provide dignity services during the affected months. This invoice was applied from April 2022 until September 2022 in the current financial year. Van Vrede also pointed out that the Post Office failed to provide adequate equipment to comply with norms and standards and did not adhere to the Sassa payment schedule.

The Agency pays a service fee for the disbursement of social grants, and the fees are as follows: R188.81 per beneficiary for Cash Pay Point, R72.95 per beneficiary for SAPO branches, and R7.14 per beneficiary for the National Payment System. However, the transition was not easy for beneficiaries, as issues such as connectivity and cybersecurity problems surfaced, and during the festive season, the Postbank picked up unusual and suspicious activity on its system.

As a result, Social Development Minister Lindiwe Zulu has raised concerns with Communications and Digital Technology Minister Khumbudzo Ntshavheni. Although the January 2023 social grant payment cycle experienced fewer inconveniences, Postbank executive Neo Moja has promised to ensure that the bank maintains momentum in the future.


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