Shock at R10 maintenance fee
AS MEMBERS of Parliament were shocked by the news that a bank would charge social grant recipients R10 a month for account maintenance fees, they were also informed that a tender for a new cash payment provider was facing a legal challenge.
The R10 charge, called an account maintenance fee, is to be levied by Grindrod Bank on at least 5.4 million grant recipients using their facilities.
Details of the R10 charge and the court challenge by S4S came out when Diane Dunkerley briefed Parliament’s Social Development Portfolio Committee on the South African Social Security Agency Security’s readiness.
The briefing by Sassa’s grants administrator came after the Constitutional Court sanctioned an application by Sassa to extend the contract of Cash Paymaster Services to continue to make cash payments to social grant recipients for a further six months from April 1.
Dunkerley said Sassa had three payment streams in readiness. Her explanation of the second stream provoked anger from MPs.
The second channel, she said, was also an electronic payment channel, but only available to those people who were using the current Sassa card. They would have to use their pin numbers at ATMs.
“For this channel we’ve split from the remainder of work that CPS has done. The payment covers about 5.4 million records. Sassa will pay directly into card accounts held by Grindrod,” she said.
“The funds for this will be released this week. Funds will be available literally from midnight on April 1. This is for everybody who uses a pin for their accounts. There are bank charges because these accounts have been moved into a banking system. It’s a fee of R10 a month. These accounts are outside of the contract where they were subsidised.
“We want to raise this as a concern,” Dunkerley said.
Grindrod, said Dunkerley, claimed that the fees would be for an “account maintenance cost of R10 a month”.
Committee chairperson Rosemary Capa reacted with indignation to this disclosure.
“To lose R10 is a bit too much. It’s never been a matter that we saw coming.”
“This is quite a critical issue. Adding R10 onto a bank fee is quite a disaster. We as a committee are really concerned about this. We cannot announce a very small increase in pensions and then we strip it,” IFP MP Liezlvan der Merwe said.