OPEN SECRETS: Digital Profiteers (Part Two): The banks and the costs of verifying social grant recipients
In the previous article, we explained why the South African government is extending the use of banks to verify grant recipients in social grants administration and how this process works. In this article, we unpack how much these banks are charging to conduct their services for social grants administration and explore the implications of their services for grant recipients’ data.
In the second part of our series on South Africa's digitalised grant system, we delve into the financial aspects of the bank verification process for social grant recipients. Earlier, we reported how the government increased the SRD grant to R624 and appealed against the ruling. The National Treasury maintains that the grant is temporary and financed through borrowing.
The Department of Social Development and Sassa have been mandated to improve their biometric and income verification processes, which forms part of the budget conditions set by the Treasury. In 2025, Sassa checked the bank accounts of six million clients and eight million credit bureau clients, leading to the cancellation of over 290,000 grants, saving the government R170-million.
We obtained contractual agreements between Sassa and banks such as Absa Bank, African Bank, FNB, Nedbank, Standard Bank, and TymeBank (now GoTyme Bank) for the period 2025-2027. These banks charge fees for conducting means tests and facilitating mobile cash transfers for SRD grant recipients without bank accounts.
FNB and African Bank directly charge SRD grant recipients for cash transfer payments, potentially reducing their grant amounts. Nedbank does not charge for cash transfers, while Absa and TymeBank do not offer this service. Standard Bank's contract is unclear on who pays for Instant Money transaction fees, but it confirmed the R7.83 fee is charged to Sassa.
The contracts do not specify the treatment of grant recipients who do not bank with these contracted banks. Open Secrets sought further clarification from the Department of Social Development and Sassa but received no response and was directed to file a Promotion of Access to Information Act (PAIA) request for more information. Language barriers also persist, with grant applicants and recipients facing challenges understanding terms and conditions.
Written by urgent.news from Daily Maverick's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
