More than 2.5 million South African Social Security Agency (SASSA) Debit MasterCards have been issued to social grant recipients across South Africa since March.<\/p>\n
The new biometric payment cards aim to provide greater security and convenience and forms\u00a0part of the social grants disbursements tender which was awarded to Cash Paymaster Services (CPS), a wholly owned subsidiary of JSE-listed firm, Net1 UEPS Technologies, in January 2012.<\/p>\n
The EMV\/UEPS Debit MasterCards with biometric functionality will be issued by Net1 and Grindrod Bank in association with SASSA.<\/p>\n
SASSA controls and manages the disbursements of 15 million social benefits to 9.2 million beneficiaries, who receive one or more of seven different social security grants available in South Africa on a monthly basis.<\/p>\n
Spending on social grants will grow from R105 billion in 2012\/13 to R122 billion in 2014\/15, the 2012 South African Budget Review revealed.<\/p>\n
In January, Herman Kotze, CFO of Net1, said: \u201cGiven the magnitude of the SASSA tender award, we expect a significant impact on the group\u2019s financial affairs when the contract period commences as a result of new volume and pricing, additional costs, capital expenditure and additional contractual obligations.<\/p>\n
The group said in May that\u00a0the second phase of its contract implementation\u00a0would commence in June and would require the re-registration of all 9.2 million beneficiaries.<\/p>\n
Technology Features<\/strong><\/p>\n A key feature of the biometric functionality of the payment cards is that it is used to identify social grant recipients using unique identifiers such as fingerprints and other personal information – this means that the payment cards cannot be used by any person other than the approved beneficiary to collect his\/her grant.<\/p>\n \u201cThe biometric information positively identifies the beneficiaries of state welfare grants and provides greater convenience, safety and security for recipients. Furthermore, it reduces the impact of fraud on government as the UEPS Biometrics solution will significantly reduce unlawful collection of grants, making sure that the funds made available by the South African government to assist those in need, are received by the people who need them the most,\u201d said Dr. Serge Belamant, chairman and CEO of Net1.<\/p>\n Recipients are able to use their SASSA Debit MasterCards to pay for goods and to check their account balances for free at till-points.<\/p>\n In addition, they can withdraw cash at ATMs and till points for an affordable charge at several participating retail outlets including Pick n Pay, Shoprite Checkers, and Spar, NET1 notes.<\/p>\n The new system is dramatically reducing SASSA\u2019s operating costs, the agency says. Until now, it has cost SASSA between R26 and R35 per grant to pay beneficiaries. Under the new agreement, disbursement costs will be capped at R16.50 per payment, enabling the agency to save up to R3 billion in operating costs over the next five years.<\/p>\n \u201cThe early success of the project rollout affirms MasterCard\u2019s vision to create a world beyond cash, as electronic payments using Debit MasterCards opens up a world of financial inclusion for many South Africans who have previously not had access to banking products,\u201d said Dries Zietsman, country manager, MasterCard South Africa.<\/p>\n \u201cWith over 2.5 million cards already issued since rollout in March 2012, it is clear that the cards are already being widely accepted by beneficiaries who are realising the benefits of a cashless environment,\u201d he concluded.<\/p>\n Net1 is a listed\u00a0provider of alternative payment systems that leverage its universal electronic payment system, or UEPS, to facilitate biometrically secure real-time electronic transaction processing to unbanked and under-banked populations of developing economies around the world in an online or offline environment.<\/p>\n In addition to payments, UEPS can be used for banking, healthcare management, payroll, remittances, voting and identification.<\/p>\n \u00a0Related article<\/strong><\/p>\n Net 1 sees 18% decrease in earnings for Q3<\/a><\/strong><\/p>\n Net1 concludes Sassa contract agreement<\/a><\/strong><\/p>\n