Sassa told the committee that it pays around 19 million social grants every month
The South African Social Security Agency (Sassa) has revealed that the majority of grant beneficiaries receive their monthly payments through commercial banks rather than Postbank.
This emerged during a presentation to parliament’s portfolio committee on social development on Wednesday, where Sassa briefed members of parliament on the termination of its Master Services Agreement (MSA) with Postbank.
Capitec most used bank
According to Sassa’s presentation, here are the banks with the most distribution numbers for all their grants and the Covid-19 Social Relief of Distress (SRD) payments:
- Capitec Bank: 7 564,066 (40%)
- SA Postbank: 3 038,002 (16%)
- African Bank: 2 169,630 (11%).
- TymeBank: 1 656,928 (9%).
- Standard Bank: 1 262,533 (7%),
- FNB: 1 220,816 (6%),
- Nedbank: 1 107,903 (6%) and
- Absa: 880 910 (5%)
- Other: 111 730 (1%)
Drilling down, the agency’s slide shows Capitec with 3 166,852 SRD recipients and 4 397,214 grant beneficiaries; Postbank with 1 080,101 SRD and 1 957,901 grant clients; and African Bank with 351 845 SRD and 1 817,785 grant clients.
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19 million grants paid monthly
Sassa told the committee that it pays around 19 million social grants every month, reaching approximately 12 million people.
The value of these grants totals R22.4 billion per month.
“The 19 million recipients receive the grants in their personal bank accounts across 22 banks, including Postbank,” Sassa said.
According to Sassa, Postbank disburses about R3 billion in grant payments every month. While significant, this is a fraction of the total amount paid nationally.
“The total number of payments made to grant beneficiaries banking with Postbank is 1.96 million grant beneficiaries and 1.08 million Covid SRD beneficiaries – approximately three million in total,” Sassa confirmed.
ALSO READ: Postbank assures uninterrupted grant payments despite reports that Sassa contract has ended
Contract is ending
The agency explained that its current arrangement with Postbank is coming to an end because the contract no longer serves its intended purpose.
In November 2023, a joint decision was taken to close Post Office over-the-counter services following the liquidation of the SA Post Office, as well as cash pay points, which were deemed costly and unsafe for beneficiaries.
In addition, the South African Reserve Bank had restricted Postbank from issuing new accounts until it replaced its gold cards.
“These were the main elements of the MSA, hence with the withdrawal of these services, the MSA no longer serves its original intent,” Sassa told MPs.
In March 2024, the agency issued Postbank with a formal 18-month notice of termination, which will take effect at the end of September 2025.
ALSO READ: Big change to how you’ll collect your Sassa social grants from September
Will beneficiaries be affected?
Despite the termination, Sassa stressed that beneficiaries who bank with Postbank will not be affected.
“The expiry of the MSA signifies the end of a contractual relationship, not the end of service provision by Postbank to its clients. Beneficiaries who choose to continue banking with Postbank will retain access to their funds through familiar channels,” Sassa said.
Postbank will continue to offer standard banking services.
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