Home Affairs minister Dr Leon Schreiber has welcomed the withdrawal of the Association of Communications and Technology’s (ACT’s) court bid to overturn the department’s 6 500% increase in the cost of biometric verification.
In a statement, which also defends the increase as a mechanism to provide “unprecedented improvements in access, efficiency and security to South Africans,” the minister adds that the withdrawal brings the matter “to finality”.
ACT – representing Vodacom, Cell C, MTN and Telkom – went to the High Court late last year to challenge Schreiber’s decision to increase the cost of a biometric check against the National Population Register from 15c to R10, a hike that came into effect in mid-2025.
The fee applies to companies verifying customer identities using government's Online Verification System (OVS) – a digital platform that enables government agencies and authorised private sector organisations to authenticate individuals against the National Population Register using biometric data, including fingerprints and facial recognition, or demographic details.
Used for banks’ requirement to ‘know-your-customer’, RICA compliance as well as essential services such as social grants, it affects millions of transactions monthly across telecommunications, banking and other sectors.
Happy to chat
ACT CEO Nomvuyiso Batyi tells ITWeb that ACT’s board resolved to withdraw the case “to create space to determine whether the industry and the Department of Home Affairs (DHA) can find common ground outside of the court process”. She says the decision was taken “in the spirit of collaboration and constructive engagement”.
At the same time, Batyi notes the association believes that exercising its “collective industry voice to challenge decisions that may have adverse effects on industry and the end-user, where necessary, forms part of our core mandate”. She adds: “ACT remains committed to a constitutional dispensation that supports rigorous dialogue and engagement between industry and government.”
ACT previously said the proposed fee hike is unjustified, disproportionate and not rationally connected to its stated objectives, warning in court papers that it will negatively affect telecommunications, financial services and other sectors reliant on consumer identity verification, with significant cost implications.
Batyi says ACT’s priority remains the end-user. “We look forward to continued collaboration towards digital transformation facilitated by a fit-for-purpose policy and regulatory environment.”
About 80% of South Africa’s mobile subscribers undergo SIM card registration regularly, driven by frequent SIM swaps for promotions, special offers, or due to loss or theft, ACT previously told ITWeb.
This churn drives millions of RICA registrations each month, with ACT noting that even a R10 fee per transaction could translate into tens of millions of rands in additional monthly costs for the sector.
Near collapse
Meanwhile, the DHA has accused corporate users of abusing an “unsustainably underpriced” system to “extract enormous profits” while the state-run verification system was starved of resources needed for maintenance and upgrades.
The department says for more than a decade, taxpayers unwittingly subsidised corporate users of the OVS at just 15c per real-time identity verification − pricing that had not been adjusted since the service was introduced in 2013.
The department has levelled serious allegations about corporate behaviour under the old pricing regime, claiming some corporate users abused the underpriced service so extensively that the DHA’s own offices lost access to the population register.
It has also accused the private sector of “apparently creating intermediaries to on-sell data at a premium, on the basis that the OVS that they had themselves driven to near-collapse through underfunding and abuse, was unreliable”.
Broader movement
Schreiber says in the statement that a number of ACT member mobile network operators have now reached out to work with the department to support government’s digital transformation agenda, including the development of a digital identity system.
The integration between Home Affairs and the banking sector through the OVS also forms part of reforms that will enable South Africans to obtain smart IDs and passports at hundreds of bank branches around the country, and through digital banking apps, the department says. It adds that most users of the upgraded OVS have welcomed the reforms and the improved performance.
According to publicinterest.org, the system will help reduce “tax fraud, identity theft and illicit financial activities that drain the national economy” through being implemented at government entities such as the South African Revenue Service.
GoTyme Bank (previously TymeBank) co-founder Coenraad Jonker became involved in a public spat with the minister in mid-2025, accusing the department of forcing South Africa’s poor to pay to sustain the register by hiking costs. Schreiber hit back on X, alleging the bank was profiting at the state’s expense and undermining national security.
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