The South African Social Security Agency (Sassa) confirmed that it will collaborate with First National Bank (FNB) to facilitate payments for individuals affected by the liquidation of Ithala SOC Limited.
Ithala Bank serves approximately 65,000 social grant beneficiaries. The majority are in KwaZulu-Natal, with smaller numbers in Mpumalanga, the Eastern Cape, Gauteng, the Free State, North West, and the Western Cape.
Without intervention, the bank’s liquidation would have left these beneficiaries without critical grant payments. This includes pensioners reliant on the government’s old-age grant, children receiving the child support grant, and individuals with disabilities who depend on the Sassa disability grant.
Following the Prudential Authority's application for Ithala SOC Limited’s provisional liquidation in the Pietermaritzburg High Court, National Treasury sought assistance from the Banking Association of South Africa (BASA) to support affected beneficiaries.
BASA approached its member banks to find institutions capable of opening new accounts for those banking with Ithala. FNB stepped in to assist.
The National Treasury informed Sassa that, in the interim, out of all the banks approached by BASA, First National Bank (FNB) offered emergency assistance to open accounts to facilitate payments for Sassa clients who were banking with Ithala.
Sassa confirmed that all Ithala clients who have not yet opened a new bank account will receive one with FNB. Beneficiaries will then have three months to provide Sassa with details of a preferred bank if they do not wish to use FNB.
Over the next three months, all clients will have the option to switch to their preferred bank. Sassa will ensure sufficient resources are available to support them.
What Ithala Bank Grant Beneficiaries Must Do
FNB has urged Sassa beneficiaries to activate their new accounts and collect their bank cards from the nearest branch between 28 January and 4 February 2025.
Clients will need a valid form of identification to collect their card. In addition, Sassa and FNB will conduct joint outreaches in rural areas to minimise travel difficulties for clients.
Sassa assured beneficiaries that FNB’s assistance will ensure they receive their grants during the February 2025 payment cycle.
The interim measure with FNB will ensure our clients continue to access their grant money on time.
Beneficiaries of the Social Relief of Distress (SRD) grant may experience payment delays. However, Sassa has confirmed that a special payment run will be conducted to process SRD grants.
Sassa urged beneficiaries to remain calm while it works with stakeholders to resolve the situation.
Beneficiaries are advised not to panic. Sassa is working closely with FNB and all relevant stakeholders to ensure payments are made as usual.
