CPS in red as grant receivers plunge
Net1 believes it has not been allowed to charge a "fair" fee while Sassa reduces the number of recipients
Net1’s Cash Paymaster Services (CPS) business has been running at a loss of about R60m a month due to the decline in the number of grant beneficiaries receiving cash at paypoints. Earlier in 2018, the Constitutional Court gave the SA Social Security Agency (Sassa) permission to extend its contract with CPS for six months, allowing it until the end of September 2018 to find an alternative disbursement method. "We’re finalising the submissions that we have to make to the court in terms of the overall financial performance of CPS over the six-month extension period," Net1 CEO Herman Kotze told investors on Thursday. Net1 believes it has not been allowed to charge a "fair" fee while Sassa reduces the number of recipients dependent on cash paypoints, and is waiting for "final pricing confirmation" from the Constitutional Court. It is still charging R14.42 per payment, but instead of doing that for 10.8-million beneficiaries, it facilitated payments to just 1.9-million people a month in t...