In with the new‚ out with the old. The SA Social Security Agency and the SA Post Office have reached a landmark agreement to usher in a new social grant payment system that will see recipients getting their grants from banks‚ various merchants and spaza shops.
The agreement was finalised on November 17 and the services agreement was entered into last week on Tuesday – just in time for submission to the Constitutional Court on Friday.
The contract Sassa has with Cash Paymaster Services was declared invalid by the Constitutional Court but the court extended its validity to 1 April 2018.
The new system‚ the Hybrid Model‚ will kick in on 1 April 2018.
Unveiling the plan in Pretoria on Sunday‚ minister in the Presidency responsible for monitoring and evaluation‚ Jeff Radebe‚ said this agreement gave effect to the implementation of the phasing in of Sapo and the Postbank as a service provider and also one of the key channels through which grants will be paid.
He said the implementation of the new plan made provision for four key channels through which beneficiaries across the country will receive their grants:
– Payments through bank accounts of beneficiaries’ choice with commercial banks;
– Payment through merchants in large retail shops;
– Payments through the Postbank of Sapo at its outlets; as well as
– Payments through a second tier of merchants which include village banks‚ general dealers‚ small retail outlets‚ Spaza shops‚ cooperatives which are legally registered and SA owned and operated.
“This will be done essentially through the insourcing of grants payments in a phased way. One of the primary objectives of this phasing is to fundamentally reduce payments for security‚ efficiency and cost saving‚” he said.
KEY POINTS YOU NEED TO KNOW ABOUT THE NEW HYBRID MODEL
– For the about 2 million beneficiaries who receive their grants through bank accounts‚ Sassa has received details of their bank accounts and from 1 January 2018 the grants will be paid directly into these accounts by Sassa.
– Sassa is in talks with banks for the establishment of a special low cost bank account. More than 5 million beneficiaries who receive their grants through electronic means – that is using a PIN number at an ATM‚ a retailer or other pay point – will be eligible for this special‚ low cost account.
– To ensure that there are no problems as beneficiaries move from their current payment point to new commercial bank‚ the current Sassa card held by Grinrod Bank will be valid until the end of December 2018. It is important to note that the December 2017 expiry date on the card no longer applies.
– The nearly 2.9-million beneficiaries who receive their grants will continue receiving their grants at more than 10‚000 pay points countrywide in the short and medium term. Sassa will conduct a competitive bidding process to appoint a service provider for the distribution of cash at pay points.
– Sassa and Sapo will embark on a verification process of the mapping done by Sassa of pay points and Sapo branches to determine pay points that can be migrated to Sapo infrastructure.
– Sassa and Sapo will cooperate to conduct biometric authentication of beneficiaries. Sassa will in turn verify the biometric data of all beneficiaries in its possession and transfer this to Sapo.
– In respect of new enrolment of beneficiaries‚ Sassa will build capacity to take over the function from current grant distributor‚ Cash Paymaster Services.
– Sassa and Sapo will identify card issuance sites where interface with beneficiaries will happen. Consideration was made to use pay points on payment days to issue cards to beneficiaries.