Many South Africans receive social grant assistance from SASSA. Net1 UEPS Technologies, the company that facilitates the payment system has made this process much simpler with the use of a SASSA card.

Pensioners are able to receive their payments loaded onto the SASSA card, as opposed to having to face the danger of carrying cash around and being robbed every month. The social grant system in South Africa is robust, as millions of the country’s citizens are living below the poverty line. Many families therefore rely on this pension payment to survive from month to month.

Net1 has recently been in the spotlight for all the wrong reasons however. In 2014, the Constitutional Court and the High court declared the awarding of the Cash Paymaster Services (CPS) tender as improper.

SASSA loans for pensioners

In addition, it’s been found that Net1 has been charging pensioners for airtime and loans. The company has been criticised in particular for offering loans at pay-points and collecting payments before grant payments are made.

Following this revelation, the payment systems provider was reprimanded by the social development minister. Lending to some of the country’s poorest citizens, Net1 was making deductions from the beneficiaries’ SASSA grants without their consent or authorisation.

SASSA pensioners receive an amount of R1350 on a monthly basis. Many recipients use this money to support their families. By getting loans from Net1, many have found themselves in a debt spiral that is difficult to get out of. Even though no interest is charged, the service fees are steep. This has caused individuals to fall into a debt trap essentially, that gives them no fair chance of getting out.

The social development minister has since instructed the company to stop offering loans to SASSA grant recipients.