Postbank has already set the wheels in motion to stop cash payments of social grants at Post Office branches from April 2024. Photo: Gallo Images/Daily Sun/Morapedi Mashashe
Amid claims of a glaring lack in communication to assist social grant beneficiaries to navigate the closure of cash payment points (CPPs) at South African Post Office (Sapo) branches, Postbank said has confirmed that it has already embarked on phase one.
According to Postbank spokesperson Bongani Diako, this month’s grant payment cycle (2 to 24 February) had signalled the first phase of the process to close Post Office CPPs by April 2024.
Diako said that from March, beneficiaries will reportedly be unable to withdraw cash from Post Office branches in cities and towns, as well as rural branches that serve less than 50 beneficiaries.
The spokesperson however stressed that the Post Office will still continue to provide non-cash services, such as card reinsurances, PIN resets and statement printing.
Postbank’s plans to migrate about the half-a-million SA Social Security Agency (Sassa) grant recipients who received their payouts in cash at post offices to other payment channels, was announced in December 2023.
A total of 870 CPPs will be closing. For those beneficiaries affected, Sassa released a schedule providing an indication of when these various payment points across the country will be closing.
The Sassa grant card works like a bank card and can be used at to withdraw money via various National Payment System (NPS) channels, including from retailers such as Boxer, Pick n Pay, Spar, Shoprite, Usave and Checkers, as well as ATMs.
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Postbank and the Post Office are legally separate, but they had an agreement which allowed the bank to use branches to pay recipients cash.
The move to stop cash payouts is part of the ailing SOE’s business rescue plan to make it cashless as branches increasingly became targets for cash-in-transit (CIT) heists over the past few years.
The other main reasons cited for the closure of the CPPs, is the Postbank and Sapo’s incompatible IT systems which make it hard to keep track of the money, as well as capacity challenges due to increased foot traffic at post offices.
The Postbank’s payment of social grants to beneficiaries was also marred by several “technical glitches” which left thousands of recipients without the only monthly income they rely on for survival.
Human rights organisation Black Sash has weighed in on the ramifications of the closure of CPPs to beneficiaries who will now be forced to dig deep into their pockets to travel to alternative pay points.
Black Sash regional manager for KwaZulu-Natal, Evashnee Naidoo, told GroundUp in December that the impact on grant beneficiaries will be “devastating”, especially for those in rural areas.
The impact on grant beneficiaries will be devastating, especially those in rural areas who will now need to find alternative means to access their grants.
“Most are likely to open commercial bank accounts, but the challenge with this is the travel costs beneficiaries will incur as many are no where near commercial centres,” Naidoo was quoted as saying at the time.
“This is also compounded by payment delays and many need to travel to ATMs or retailers on multiple days.”
In a News24 report this past week, she spoke about the general panic and confusion among beneficiaries in February regarding the closure of the Post Office CPPs.
“Within our beneficiaries, we have found a lot of confusion about the closure [of CPPs at post offices]. They do not know where they will be getting their grants now…Now, they will have additional travel costs. ATM security is also an issue, and retailers have begun to struggle with the number of beneficiaries coming in for payments,” she said.
In addition, Naidoo claimed that there has not been sufficient communication from the government to assist with the closure of CPPs and help beneficiaries cope with the change in NPS channels.
According to her, the majority of elderly and disabled grant recipients are reluctant to make the move to other NPS channels as they see the Post Office as a safe and reliable option to access their money. It also requires less technical literacy than ATMs.
In response Black Sash’s claim of insufficient communication, Diako told News24 that Postbank and Sassa are implementing a “nationwide communication” programme regarding the details of closures of CPPs at post offices via social media platforms, radio announcements and community engagements.
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