Sassa argued that the master service agreement has become obsolete.
The Gauteng High Court in Pretoria has removed from its roll Postbank’s urgent application aimed at stopping the South African Social Security Agency (Sassa) from ending its service agreement.
The ruling was delivered on Friday.
Postbank declares dispute against Sassa
The master service agreement (MSA), which governs Postbank’s role in distributing social grants, will officially end on Tuesday.
This contract originated in 2018 when the Post Office — later succeeded by Postbank — was tasked with paying grants after the Constitutional Court (ConCourt) ordered government to end the unlawful cash paymaster services (CPS) deal.
Sassa issued a notice in December 2023 of its intention to terminate the agreement, providing a six-month lead time.
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However, Postbank had sought an 18-month period to wind down services, which was granted.
While 30 September 2025 was set as the end date of the agreement, Postbank declared a dispute and later lodged an urgent interdict application to keep the contract alive.
Sassa had argued that the MSA has become obsolete because the majority of cash pay points have been closed.
However, Postbank contended that terminating the contract would harm grant recipients, as the bank would be forced to impose withdrawal charges.
Interdict application ‘inherently urgent’
Delivering her ruling on Friday, the judge noted that Postbank declared a formal notice of dispute against Sassa on 25 July.
She highlighted that Postbank argued that, despite ongoing engagements between the parties, Sassa publicly announced on 20 August that the MSA would proceed to be terminated next week.
According to the judge, Postbank told the court the announcement prompted it to file the urgent application on 1 September, seeking interim relief to block the termination until the dispute resolution process had run its course.
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Postbank also told the court it had given Sassa until 8 September to oppose the application, with the matter scheduled for hearing on 23 September.
“On behalf of the applicants, argued that it attempted to resolve its dispute before initiating legal proceedings, but as a result of the failure of that step so taken, it decided to institute these proceedings.
“Therefore, the bringing of this application, so it asserts, is justified as the matter implicates constitutional rights of the beneficiaries and therefore the matter is inherently urgent,” the judge said.
High Court ruling
Meanwhile, Sassa contended Postbank knew as far back as March 2024 that the MSA would end on 30 September and had, therefore, created its own urgency by waiting until then to approach the court.
“Furthermore, [Sassa argued] that the applicant can be afforded substantial redress at the hearing in due course, as it has before this court pending review proceedings,” she said.
The judge agreed with Sassa’s submissions, stating that Postbank had not adequately explained the 18-month delay in launching its court challenge.
“Consequently, the application is struck from the urgent roll with costs,” she ruled.
MSA termination won’t impact Sassa grants
Social Development Minister Sisisi Tolashe and Sassa officials briefed parliament about the end of the MSA in late August.
The portfolio committee on Social Development was informed that the Post Office’s liquidation in 2023 had already led to the shutdown of cash-payment points as well as over-the-counter grant services, prompting the transfer of the contract to Postbank.
Members of parliament also heard that the South African Reserve Bank (SARB), in 2019, restricted Postbank from opening new accounts until it resolved the replacement of Sassa’s gold cards.
These developments, officials said, formed part of the reasons the contract could not continue.
Despite the termination, Tolashe assured parliament that social grant payments to roughly three million Postbank clients would not be interrupted after the MSA ends.
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