JOHANNESBURG--(BUSINESS WIRE)--More than 2.5 million South African Social Security Agency (“SASSA”) MasterCard debit cards have been issued to social grant recipients across South Africa as part of the social grants disbursements tender which was awarded to Cash Paymaster Services (“CPS”), a wholly owned subsidiary of Net1 UEPS Technologies, Inc (“Net1”) in January 2012.
The EMV/UEPS debit MasterCard cards with biometric functionality will be issued by Net1 and Grindrod Bank in association with SASSA.
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 including: The State Old Age Pension, War Veteran Grant, Disability Grant, Child Support Grant, Foster Child Grant, Grant-in-aid and Care Dependency Grant. Spending on social grants will grow from R105 billion ($13.13 billion*) in 2012/13 to R122 billion ($15.25 billion) in 2014/15, the 2012 South African Budget Review revealed.
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, which means that the payment cards cannot be used by any person other than the approved beneficiary to collect his/her grant.
“The 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,” says Dr. Serge Belamant, Chairman and CEO of Net1.
Recipients are able to use their SASSA MasterCard debit cards to pay for goods and to check their account balances for free at till points. 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.
The new system is dramatically reducing SASSA’s operating costs. Until now, it has cost SASSA between R26 ($3.25) and R35 ($4.38) per grant to pay beneficiaries. Under the new agreement, disbursement costs will be capped at R16.50 ($2.07) per payment, enabling the agency to save up to R3bn ($375m) in operating costs over the next five years. This means that the agency will be able to spend its budget allocation more effectively in the future, making a meaningful difference in the lives of more South Africans.
“The early success of the project rollout affirms MasterCard’s 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,” says Dries Zietsman, Country Manager, MasterCard South Africa.
“With 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,” he concludes.
MasterCard (NYSE: MA), www.mastercard.com, is a global payments and technology company. It operates the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone. Follow us on Twitter @MasterCardNews, join the conversation on the Cashless Conversations Blog and subscribe for the latest news.
Net1 (NASDAQ: UEPS ; JSE: NT1) is a leading provider 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. In addition to payments, UEPS can be used for banking, healthcare management, payroll, remittances, voting and identification. Net1 operates market-leading payment processors in South Africa, Republic of Korea, Ghana and Iraq.
*Where USD $1 = R8.00