Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      Don’t expect Starlink in South Africa anytime soon

      24 June 2025

      Home affairs under fire

      24 June 2025

      Samsung to unveil new folding phones at July event

      24 June 2025

      Capital Appreciation banks on payments to offset software slump

      24 June 2025

      Crypto is becoming a ‘practical payment method’ in South Africa

      24 June 2025
    • World

      Mira Murati’s Thinking Machines hits $10-billion valuation

      24 June 2025

      Watch | Starship rocket explodes in setback to Musk’s Mars mission

      19 June 2025

      Trump Mobile dials into politics, profit and patriarchy

      17 June 2025

      Samsung plots health data hub to link users and doctors in real time

      17 June 2025

      Beijing’s chip champions blacklisted by Taiwan

      16 June 2025
    • In-depth

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025

      Digital fortress: We go inside JB5, Teraco’s giant new AI-ready data centre

      30 May 2025

      Sam Altman and Jony Ive’s big bet to out-Apple Apple

      22 May 2025
    • TCS

      TechCentral Nexus S0E3: Behind Takealot’s revenue surge

      23 June 2025

      TCS | South Africa’s Sociable wants to make social media social again

      23 June 2025

      TCS+ | AfriGIS’s Helen Hulett on how tech can help resolve South Africa’s water crisis

      18 June 2025

      TechCentral Nexus S0E2: South Africa’s digital battlefield

      16 June 2025

      TechCentral Nexus S0E1: Starlink, BEE and a new leader at Vodacom

      8 June 2025
    • Opinion

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025

      South Africa risks being left behind as stablecoins reshape global finance

      6 June 2025

      Beyond the box: why IT distribution depends on real partnerships

      2 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » News » Sassa wants CPS to have more powers

    Sassa wants CPS to have more powers

    By Ray Mahlaka19 February 2018
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Social security agency Sassa wants to give Net1 subsidiary Cash Paymaster Services (CPS) more powers in the distribution of social grants if its invalid contract is extended for an additional six months from 1 April.

    Sassa acting CEO Pearl Bhengu asked the constitutional court earlier this month to lift the invalidity of the CPS contract to pay a portion of 10.7m social grant beneficiaries until September 2018.

    Under the extended contract, CPS would be the paymaster for only 2.5m elderly and disabled beneficiaries.

    In justifying CPS’s involvement, Bhengu said Sassa had been unable to find an alternative service provider to pay elderly and disabled beneficiaries that don’t own bank accounts but access their social grants in a physical cash format via CPS’s vehicles kitted with its biometric UEPS/EMV technology. The remaining eight million beneficiaries access their social grants via bank ATMs or retail points.

    We don’t want to be continuously trapped in an arrangement that is seen to be an extension of an invalid contract. It has really been damaging to us

    However, it appears that Sassa wants to give CPS more powers, asking it to offer services that are beyond processing payments to elderly and disabled beneficiaries.

    A Sassa letter, dated 13 February, asked CPS to continue to provide a system of support for existing Sassa/Grindrod Bank cards, which grant recipients use to withdraw their money at ATMs, retail and CPS pay points. The letter was contained in CPS’s submission to the constitutional court on Wednesday as it responded to Bhengu’s affidavit.

    The agency also asked CPS to issue Sassa-branded Grindrod cards to new beneficiaries, which would require CPS to maintain its beneficiary enrolment services.

    However, in an interview with Moneyweb, Net1 CEO Herman Kotzé said CPS is not in favour of a six-month extension.

    The main reason for rejecting the extension, Kotzé said, is that Net1’s reputation has been sullied for scoring the contract in an invalid manner. “We don’t want to be continuously trapped in an arrangement that is seen to be an extension of an invalid contract. It has really been damaging to us.”

    Must be legal

    Net1 might consider the extension if there is no other way to pay social grants as “we don’t want to be responsible for the failure of the grants system”. The process to extend the contract must be regularised and legal, Kotzé added.

    CPS also wants the court to revise the fee it is paid by Sassa. Under its current contract, CPS is paid R16.44/beneficiary by Sassa to pay more than 10m beneficiaries.

    In court papers, CPS director Nunthakumarin Pillay said the company would be required to pay only 2.5m beneficiaries when its contract is extended for six months, resulting in its revenue being “reduced by approximately two-thirds”.

    Imposing the same price per beneficiary (R16.44) paid over the extension period would result in CPS operating at a significant loss

    “Imposing the same price per beneficiary (R16.44) paid over the extension period would result in CPS operating at a significant loss, since it would be required to incur largely the same costs as before,” said Pillay.

    The costs associated with running its services includes salaries, security for cash-in-transit vehicles at pay points, insurance vehicles, equipment maintenance and more.

    Essentially, CPS wants to be paid more for its services but didn’t disclose its preferred amount. Instead, Pillay asked the national treasury to determine a “reasonable price”.

    Many observers had expected CPS’s involvement in the social grants payment network beyond 1 April given Sassa’s delays in contracting the Post Office and commercial banks, which were meant to take over the full payment of social grants from CPS.

    Embattled social development minister Bathabile Dlamini has been blamed for the delays. Dlamini’s former advisor, Zane Dangor, and former Sassa CEO Thokozani Magwaza have testified at the constitutional court-mandated inquiry into the social grants fiasco that the delays were designed by Dlamini to pave the way for CPS to still be the paymaster.

    Net1’s Kotzé rejected the assertion that Dlamini favours CPS.

    “She (Dlamini) is concerned that there is no clear replacement plan (for CPS’s contract). In the minister’s mind, the last thing she wants to see is for the system to fail and people not to be paid on her watch. There is something that works, like clockwork and replacing it without a bulletproof plan in place is a very daunting task,” said Kotzé.

    • This article was originally published on Moneyweb and is used here with permission


    Bathabile Dlamini Cash Paymaster Services CPS Herman Kotze Net1 Net1 UEPS Technologies Pearl Bhengu Sassa
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleFormer Didata CEO joins Ubusha board
    Next Article Telkom taking market share from mobile rivals: CEO

    Related Posts

    Compulsory biometric tests for some Sassa beneficiaries

    24 April 2025

    How South Africa’s social grants system was defrauded on a massive scale

    6 January 2025

    Letter | Alleged Sassa fraud underscores urgency for better data management

    30 October 2024
    Company News

    TechCentral: South Africa’s premier platform for ICT leaders

    24 June 2025

    Section 18A deductions and BEE points – a strategic choice for business compliance in 2025

    24 June 2025

    Huawei Watch Fit 4 Series: beauty, brains and a battery that won’t quit

    24 June 2025
    Opinion

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    AI and the future of ICT distribution

    16 June 2025

    Singapore soared – why can’t we? Lessons South Africa refuses to learn

    13 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.