Picture: David Ritchie/ANA Pictures
A test run in paying grant beneficiaries on a new system was successful, South Africa Social Security Agency (Sassa) spokesperson Paseka Letsatsi said yesterday.

Social justice and human rights advocacy group Black Sash said it was concerned by the lack of clarity around the proposed payment model, in particular how cash payments will be made, as well as the transfer of beneficiaries to commercial bank accounts.

In December, minister in the Presidency and chairperson of the inter-ministerial committee tasked with social security, Jeff Radebe, said Sassa and the SA African Post Office had reached an agreement over the payment of social grants.

The agreement gave effect to the implementation of the phasing in of the Post Office and the Postbank as a service provider and also as one of the key channels through which grants will be paid.

Radebe reiterated that “this matter is too serious for government not to prioritise”.

On March 17 last year, the Constitutional Court ruled that Sassa and the Department of Social Development had to find an alternative service provider to Cash Paymaster Services.

Letsatsi said there are ongoing negotiations between banks and National Treasury to look at a proposal of low-cost banking solutions for beneficiaries of social grants.

Sassa will subsidise the account to ensure that recipients of social grants are cushioned from paying high bank charges for their transactions, Letsatsi said.

“The hybrid model that Sassa will use involves paying beneficiaries either directly into their private bank accounts or in cash at Sassa pay points and Post Office outlets. Sassa has reactivated its Pay Master General account with the South African Reserve Bank. Thus, the system will enable Sassa to affect direct payments to beneficiaries' accounts. The system was tested in January and was successful.”