Committee Notes Termination of Master Service Agreement Between South African Social Security Agency (SASSA) and Postbank

 The Portfolio Committee on Social Development has noted the termination of the Master Service Agreement (MSA) between the South African Post Office (SAPO) and the South African Social Security Agency (SASSA) at the end of September 2025. SASSA has informed the committee that the resources that were allocated to the Postbank for the infrastructure for mobile cash withdrawal services will now be used to roll out its digitisation of its business processes, including the biometric verification of all new grant applications that will commence on 1 September 2025.

The committee received a briefing from the Minister of Social Development, Ms Sisisi Tolashe, and SASSA today on the termination of the MSA. The Minister explained that SASSA entered into a contractual relationship with the SAPO in 2018 after the Constitutional Court ordered government to terminate the unlawful Cash Paymaster Service (CPS) contract. The liquidation of the SAPO in 2023 necessitated the closure of costly cash pay points and over-the-counter services, and the contract was ceded to Postbank.

In 2019, the South African Reserve Bank limited the Postbank from issuing new bank accounts until it dealt with the replacement of the SASSA gold cards. These were the main elements of the MSA, hence with the withdrawal of these services render the MSA no longer serving its original intent.

Minister Tolashe assured the committee that there will not be any interruptions to the payment of grants as a result of the MSA termination. Payments will continue being disbursed through all the banks operating in South Africa, including Post Bank, as it is the current arrangement.

The Chairperson of the committee, Ms Bridget Masango, said: “The main interest of the committee is to ensure that there is no interruption of the payment of grants to the 3 million beneficiaries who bank with Postbank, post the termination of the MSA.”

The committee resolved to conduct an oversight visit to rural communities to assess the impact of the closure of the cash pay points services to grant beneficiaries.

Distributed by APO Group on behalf of Republic of South Africa: The Parliament.