Why Sassa Faced Grant Payment Challenges

During the final months of 2022, thousands of grant beneficiaries had difficulty accessing their social grants. Several reasons have been revealed by the department for the challenges with grant payments.

Why Sassa Faced Grant Payment Challenges

In 2022, the South African Post Office (SAPO) will cede its partnership with the South African Social Security Agency (Sassa) to Postbank. After months of administrative challenges, technical issues, corruption, and failure to pay social grants, the decision was made.

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The Department of Social Development (DSD) was invited to brief the portfolio committee on Social Development on the status of social grant payments in February 2023.

The briefing revealed that SAPO did not provide dignified services, did not have adequate equipment to comply with norms and standards, and failed to adhere to a payment schedule. In 2022, these challenges continued for six consecutive months.

In terms of rights, obligations, related costs, and revenue, the Postbank acquired the Sassa Master Service Agreements (MSA) from SAPO “As-Is.”.As there were no systemic changes, grant beneficiaries were not supposed to notice the transition.

While Postbank has taken over the contract, it has experienced network challenges and system glitches that have caused ATM and retail transactions to fail since taking over the contract.

In Following the discovery of malicious activity on Postbank’s IT network in December 2022, the challenges faced Postbank escalated. To improve and assist with their IT systems, Postbank hired an external cyber security team.

In January 2023, there were again challenges with grant payments. The SAPO data centre was affected by a power outage at a City of Tshwane substation. Additionally, a backup generator failed at the data center, compounding the challenges posed by the power outage.

As a result, SAPO branches across the country were unable to process grant payments. ATMs and retailers were available for grant beneficiaries to withdraw their funds.

In order to enhance security and stability, the Postbank migrated the Integrated Grants Payments System (IGPS) to a secure cloud environment. February 2023 was a month without major incidents, according to the report.To avoid inconveniencing millions of grant beneficiaries in the coming months, they also committed to maintain the stability of the grant payment system.