The South African Social Security Agency (SASSA) says its new tender for social grant payments in SA will be awarded in the next two months.
Following a ruling by the South African Constitutional Court last year, SASSA had to re-issue a new tender process for the distribution of social grants in the country. The ConCourt ruled that awarding the tender for grants distribution to Cash Paymaster Services (CPS), a subsidiary of US-based company Net 1 UEPS Technologies, was "irregular".
The court's ruling meant the Net 1 subsidiary, and among others, Absa's AllPay, would have the chance to apply for the tender to distribute social grants in the country. However, earlier this year, Net 1 announced its subsidiary would no longer participate in the five-year, R10 billion contract.
SASSA national spokesperson Kgomoco Diseko confirmed to ITWeb that SASSA's new tender process has now closed.
"The tender process is closed but CPS is still administering social grants on behalf of SASSA until a new service provider takes over."
Diseko adds: "In October 2015, the new tender will be awarded."
Prior to its decision to withdraw from the tender process, Net 1 said management was analysing the request for proposals to determine whether CPS should participate in the tender process, or focus on its other financial technology businesses without being a direct contractor to SASSA.
The Net 1 subsidiary was contracted with handling social grant payments to more than 10 million South Africans.
Fraud troubles
In July, SASSA uncovered grant fraud to the value of R7 million at its office in Mitchells Plain, Cape Town.
According to SASSA, one of its officials, a grant administrator responsible for processing grant applications, fraudulently enrolled 10 social grant beneficiaries on the system in order to access grant money.
At the time, SASSA's national spokesperson noted 14 officials from the Mitchells Plain office were being investigated for defrauding the grant disbursement system.
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