Net1 UEPS Technologies "remains fully committed to supporting the South African government to ensure uninterrupted social grant service delivery", says CEO Herman Kotz'e.
Kotz'e made this note in a SENS statement of the alternative payments company's first quarter 2018 results this morning.
Net1, through its subsidiary Cash Paymaster Services (CPS), distributes social grants on behalf of the South African Social Security Agency (SASSA).
The CPS five-year social grants contract expired at the end of March, but the Constitutional Court (ConCourt) ordered its extension until the end of 31 March 2018 to avert a social grants catastrophe. At the time, the ConCourt said its decision was prompted by minister Bathabile Dlamini and SASSA's failure to find a suitable distributor to take over payments when the contract reached its expiration date.
With the extension, the court gave the social development department and SASSA time to sever ties with CPS and find an alternative grant payment system.
However, with less than five months before the ConCourt deadline, there are increased fears that the livelihoods of millions of vulnerable South Africans will be compromised.
Post office support
As SASSA and the South African Post Office (SAPO) failed to find a working solution on the future of social grants, the Inter-Ministerial Committee (IMC) on Comprehensive Social Security has committed to fast-track a co-operation deal between the two entities.
While Dlamini has been quick to highlight SAPO's shortcomings, the national postal entity is a government favourite to take over social grant payments. The social development minister said last week, SAPO is "incapacitated" and noted it can only offer one out of the four services required to pay social grants.
However, appearing before the Standing Committee on Public Accounts and the Portfolio Committee on Social Development in Parliament this week, minister and IMC chairperson Jeff Radebe promised the committee will ensure all agreements between SASSA and SAPO are signed by Friday, 17 November.
Radebe pointed out that government is going to be doing social grant payments. He added it wants to "make sure the grants will be distributed by an entity other than CPS".
The IMC, which was established to ensure the ConCourt order concerning the payment of 17 million social grants is well executed, was initially chaired by president Jacob Zuma.
Global player
Meanwhile, Net1's commitment to the South African government comes on the back of its announcement of plans to globalise its social benefits payment technology under the leadership of Carl Scheible.
In a SENS statement, Net1 says it has entered into arrangements with Scheible for him to lead and partner in the development and implementation of a global expansion and deployment of large-scale UEPS or EMV projects for the Net1 group, specifically targeting already identified developing economies.
Scheible will initially operate business development activities from London, reads the statement.
"This is a significant strategic move for the company, says Kotz'e. "It will enable Net1 to truly become a global leader in its space. Carl has intimate knowledge and experience across multiple geographic markets as well as the payments industry, and will lead a dedicated effort to execute our strategy.
"We are extremely excited to have Carl join us to drive our global vision. It will enable us to provide specific focus in a high-growth segment. Large-scale payment system technologies and projects are complex and have high barriers-to-entry. The upside potential of this move for the company is significant, considering the estimated global market of more than 2.5 billion people," he concludes.
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