Are SASSA beneficiaries losing money by switching to personal bank accounts?
A growing number of SASSA beneficiaries are opting to receive their grants through personal bank accounts.
Image: Nokuthula Mbatha/ Independent Newspapers.
The North West Legislature's Portfolio Committee on Health and Social Development has raised serious concerns over the growing trend of social grant beneficiaries opting to receive their payments through personal bank accounts, a move that could be costing them a portion of their much-needed support.
During an oversight meeting held with the South African Social Security Agency (SASSA) and the Department of Social Development, Committee members were briefed on the migration from the traditional SASSA Gold Cards to the newly introduced Postbank Black Cards.
The migration was prompted by a South African Reserve Bank (SARB) directive following a security breach involving the Gold Cards.
However, it emerged that SARB has now suspended the migration process indefinitely. Beneficiaries are currently permitted to continue using their existing SASSA Gold Cards beyond the original May 31 deadline, a shift the Committee believes must be communicated to avoid panic and confusion.
"People were rushing to switch cards, some even under pressure. Now, they need clarity and reassurance that their current cards are still functional. You need to ensure that this is communicated widely,' urged Committee Chairperson, Hon. Karabo Magagane.
The Committee expressed deep concern over SASSA's revelation that 43,945 grant recipients have chosen to bypass both the SASSA Gold Card and the Postbank Black Card systems, instead opting for direct bank payments.
While this may offer perceived convenience, the Committee fears that the associated transaction fees at commercial banks are quietly eroding the actual value of the grants.
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Advertisement
Next
Stay
Close ✕
Ad loading
'These beneficiaries may not realise that they are losing money to transaction fees and service charges, funds that are meant to support their most basic needs,' Hon. Magagane cautioned.
Further compounding the financial strain, Committee members highlighted the informal deductions being imposed by some local retailers.
Local tuck shops reportedly charge R10 for every R100 withdrawn, a surcharge that further reduces the amount of money recipients receive.
'This completely defeats the purpose of a social grant. A grant is supposed to alleviate poverty, not get eaten up by unnecessary charges,' one member stated.
The Committee also slammed the limited number of Postbank conversion sites in the North West.
Currently, only 12 sites are operational across the province, a situation described as 'grossly inadequate,' particularly for elderly beneficiaries living in remote areas.
"Many of our elderly citizens live far from these centres and are not in a position to travel long distances just to access a card. This could be a driving factor behind the shift to personal bank accounts," said Hon. Magagane.
In response to the pressing challenges, the Committee pledged to intensify its engagement with SASSA and Postbank, the two State-Owned Entities tasked with grant disbursement, to push for more accessible service points, better communication, and increased public awareness.
"We are committed to ensuring that no beneficiary is left behind. We will push for ongoing awareness campaigns, improved accessibility, and sustained outreach efforts so that every grant recipient understands their options and the implications of each," Hon. Magagane said.
The Committee is expected to reconvene in the coming weeks to assess progress and implementation of the proposed solutions.
IOL News Get your news on the go, click
here to join the IOL News WhatsApp channel.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Citizen
2 hours ago
- The Citizen
Political events happening in June expected to affect South African SMEs
'The fuel levy increases will compound existing cost pressures for SMEs, particularly those in logistics, manufacturing, and retail sectors that rely heavily on transportation.' June will provide some relief for Small and medium enterprises (SMEs) following the South African Reserve Bank's (SARB) Monetary Policy Committee's (MPC) decision to cut interest rates by 25 basis points. Another relief is that inflation is largely stable, and the exchange rate is trending favourably, giving the MPC some room for monetary easing. The economy needs every bit of help it can get, and this cut will no doubt be reflected in business confidence. Miguel da Silva, group executive for business banking at TymeBank noted how upcoming events will impact South Africa's position in a rapidly evolving global landscape and the effect of this reconfiguration on SMEs. ALSO READ: Reserve Bank cuts repo rate thanks to lower inflation, stronger rand Budget treads tricky course without cutting expenditure 'The national budget outlined a programme of continued expenditure propped up by less contentious funding mechanisms than previously tabled,' said Da Silva. After much debate, the Value Added Tax (VAT) rate will remain at 15%, providing certainty for SME pricing and cash flow planning following the proposed increase's withdrawal. To make up the shortfall, the general fuel levy has increased by 16 cents per litre for petrol and by 15 cents per litre for diesel. 'The fuel levy increases will compound existing cost pressures for SMEs, particularly those in logistics, manufacturing, and retail sectors that rely heavily on transportation.' With many small businesses already operating on razor-thin margins, this 16-cent increase represents an additional burden that will likely be passed on to consumers, potentially dampening demand in an already constrained market. ALSO READ: GDP grew marginally in first quarter – agriculture helped keep economy afloat First quarter GDP figures 'The Minister also revised his predictions for our economic growth to 1.4% in 2025, down from 1.9%. With the official unemployment rate now at 32.9%, the disconnect between our economic ambitions and the harsh reality that only 16.8 million South Africans are in active employment highlights the urgent need for policy innovation,' he added. Da Silva said what seems clear is that under these constrained market conditions, there is no way for established businesses to incorporate the millions of South Africans seeking employment. There is far greater potential for entrepreneurs to create new jobs, and a focus on small business support and development must be prioritised. 'SME funding will remain an important area of discussion and entrepreneurs; funders and public-sector representatives will meet to discuss the state of small business funding in South Africa at the SME SA Funding Summit 2025 on 12 June – but even more important is the creation of an environment which is conducive to entrepreneurship: less red tape and dependable infrastructure.' ALSO READ: Tariffs and Agoa: How Parks Tau summarised US-SA trade talks Agoa forum in DRC The relationship between SA and the US remains fraught, but at least there is dialogue. 'Apart from the Presidential meeting in the Oval Office, trade, industry and competition minister Parks Tau and agriculture minister John Steenhuisen have submitted a new trade framework to US trade representative Jamieson Greer. 'There are key areas where US investment might help us unlock value at home, and which might appeal to the deal-centric nature of the US administration. Developing a domestic source of natural gas would bolster SA's regional competitiveness and energy security, and we remain a key source of scarce minerals,' he added. The annual conference on the African Growth and Opportunity Act (Agoa) between trade ministers of Agoa-eligible countries and the US is scheduled to take place in the Democratic Republic of the Congo (DRC) in June. This will be an important indicator of what the US will do when Agoa expires in September 2025, though it seems unlikely at this stage that SA's Agoa benefits will be extended. While the overall impact of losing Agoa would not be immense for SA, some sectors – particularly the automotive and agricultural sectors – would be significantly affected. Both sectors have extensive value chains, and SME suppliers are rapidly adjusting their operations. 'The potential loss of Agoa benefits creates particular uncertainty for SME suppliers in the automotive value chain, many of whom have built their business models around preferential access to US markets. 'These companies now face the complex challenge of either finding alternative markets or restructuring their operations to remain competitive under standard trade terms.' ALSO READ: Analysts say Trump's bid to weaken Brics will fail as US influence declines Brics summit in Brazil Da Silva added that the Brics Summit, scheduled to take place in Brazil in early July, will again put SA in the US crosshairs, as provocative issues (such as an alternative to the dollar as the world's reserve currency) will be raised and debated by Brics countries. 'The timing could not be more delicate. For SMEs, particularly those in export-oriented sectors, this diplomatic tightrope walk translates into very real business planning challenges. 'Where do allegiances lie in a rapidly shifting global order? This geopolitical balancing act requires SMEs to develop strategies that can withstand diplomatic volatility while capitalising on emerging opportunities within both Western and Brics markets.' NOW READ: Political uncertainties that will impact SMEs in the coming months
IOL News
7 hours ago
- IOL News
Stronger rand helps South Africa reduce trade deficit
South Africa exported more than it imported in the first quarter, thanks to a rise in the value of exports, the Reserve Bank said. Pictured is Sarb governor, Lesetja Kganyago South Africa exported more than it imported during the first quarter of the year, the South African Reserve Bank (SARB) said, citing the fact that the value of goods exported had increased in rand terms. The local currency has been worth between just under R19 to the dollar at the start of the year to sticking below the key R18 to the greenback level since the middle of last month. In a statement issued on Thursday, the central bank said that South Africa's trade surplus narrowed slightly by R5.2 billion as the value of merchandise imports increased more than that of goods exports. The increase in the value of imports and exports of goods and services in the first quarter of 2025 reflected both higher volumes and prices, the central bank explained.
The Citizen
a day ago
- The Citizen
Biometric verification now required for all new SRD grant applications
Biometric verification now required for all new SRD grant applications Starting 7 June, anyone applying for the Covid-19 Social Relief of Distress (SRD) grant must complete biometric verification as part of the application process. This new step applies to all new applications and is part of Sassa's efforts to combat fraud within the system. To make your application smoother, ensure you have your smart ID card ready before starting the process. Applications can be submitted, and the verification process completed online at: Make sure to follow the latest Sassa guidelines to avoid delays and ensure your application is processed successfully. Don't have the ZO app? Download it to your Android or Apple device here: HAVE YOUR SAY Like our Facebook page and follow us on Twitter. For news straight to your phone invite us: WhatsApp – 060 784 2695 Instagram – zululand_observer At Caxton, we employ humans to generate daily fresh news, not AI intervention. Happy reading!
