Grant recipients will no longer have the option to withdraw cash from Post Offices, as announced by the Postbank and South African Social Security Agency (Sassa) on Monday.
Sassa distributes 19 million permanent grants which include the Older Persons pension grant, Disability grant, War Veterans grant, Care Dependency grant, Foster Child grant, Child Support grant, Child Support grant Top-Up and Grant-in-aid. Many of these grant beneficiaries choose to collect cash at a Post Office branch due to its accessibility in rural areas.
In a joint statement, Sassa and the Postbank revealed plans to phase out all physical cash payment points (CPPs), including cash withdrawal services at Post Offices, starting in January next year and concluding by the end of March 2024.
The transition will be implemented sensibly to ensure that no one is left out. The aim is to ensure continuity in the payments for everyone and that every person is paid their grant in the most efficient, safe, secure, reliable and convenient manner.
This decision was initially disclosed in 2018 as part of a broader strategy aimed at reducing cash-in-transit heists, addressing unfavourable conditions at CPP sites, and overcoming capacity challenges at the Post Office.
Postbank spokesperson Bongani Diako clarified that while Post Office branches will continue to provide non-cash services such as card reinsurances, PIN resets, and statement printing, the payment of cash to beneficiaries will be discontinued.
Where Can Sassa Grant Beneficiaries Get Cash?
Sassa grant beneficiaries will still be able to withdraw cash despite the announcement. They can withdraw cash at any ATM or one of the retailers that pay Sassa grants. These retailers include Boxer, Pick N Pay, Spar, Shoprite, Usave and Checkers.
Sassa gold card social grant recipients using CPPs and Post Office branches must now use those cards at any place that accepts a bank card. This includes making purchases in any retailer that has a point of sale to swipe for goods or withdrawing funds from any retailer that provides a cash-back functionality.
It was reported that approximately 98% of grant beneficiaries already use these challenges to collect their grants. Sassa says this indicates that the announcement will not affect many social grant beneficiaries.
However, civil society organisation Black Sash has criticised the decision, arguing that it was made without proper research and consideration of its impact, particularly on pensioners and disabled individuals in rural areas.
They say Interviews with grant recipients revealed dissatisfaction, with concerns about increased transport costs, delays at alternative payment sites, and withdrawal fees at ATMs and retailers.
More than 60% of recipients expressed a need for assistance at pay points, including ATMs, further emphasising the potential challenges and drawbacks associated with the transition.
Post Office Challenges
This announcement that grants cash payments of the social grant will conclude comes amidst the Post Office's financial struggles, having incurred a R6 billion loss over the past three years, with an R2.2 billion loss in the 2022/2023 financial year.
As part of its business rescue plan, the Post Office is set to close 420 loss-making branches and retrench 6,000 employees, with the potential for a R3.8 billion government bailout. The plan also includes phasing out revenue streams that have “failed to produce revenue”.
The revenue services they are referring to include Over Counter (‘OTC’) payment services, which include SASSA and cash pay points (‘CPP”) payments. If the plan is adopted later this year, the Post Office will no longer pay social grants.
Are Sassa Gold Cards Expiring?
Sassa gold cards will not expire in December 2023 and will remain fully valid and operational in 2024. This guarantees that grant beneficiaries can use their gold cards, even if it is expired and they will not need to be renewed.
