What the expiry of the SASSA Postbank MSA means for social grant beneficiaries

The Department of Social Development (DSD) and the South African Social Security Agency (SASSA) are briefing the Portfolio Committee on Social Development in Parliament on the expiry of the SASSA Postbank Master Service Agreement (MSA) at the end of September 2025.

The focus is on the measures in place to guarantee a smooth transition for millions of South Africans who depend on social grants.

Minister of Social Development, Sisisi Tolashe, addressed the committee, emphasizing that the change is purely administrative and will not affect beneficiaries’ access to funds.

“The termination of the MSA is a contractual matter to terminate an agreement that no longer serves the purpose of which it was intended,” Minister Tolashe said.

“Postbank remains a fully licensed and operational financial institution, and beneficiaries will continue to receive their grants in their Postbank accounts, just as they have before. No change in this regard will occur.”

Tolashe highlighted the historical context of the agreement, noting that SASSA entered into the MSA with Postbank after a 2017–2018 Constitutional Court ruling instructed SASSA to take responsibility for grant distribution following the termination of its contract with Cash Paymaster Services (CPS).

“CPS as a public representative was also entrusted with the responsibility to make sure that our people are served with dignity and respect while ensuring that this is done within the confines of the legal prescripts,” she said.

“The beneficiaries of social grants deserve stability and confidence, not confusion or fear.”

Acting SASSA CEO Brenton Van Vrede provided further details on the operational impact, explaining that approximately 3 million beneficiaries receive grants through Postbank, accounting for roughly R3 billion in monthly payments.

“Even though we're terminating the MSA because we pay money directly into people's bank accounts, that does not change,” Van Vrede said.

“The Postbank bank account is a formal bank account regulated within the banking sector, and we'll continue to pay social grant beneficiaries their grants into the Postbank account, and that doesn't need the MSA for us to do that.”

He explained that the MSA was originally structured to facilitate over-the-counter services and cash pay points, both of which have been discontinued.

“Once that decision was taken to close those services, the MSA became, it was no longer serving its purpose or its intent,” Van Vrede said.

Both Tolashe and Van Vrede stressed that no new service provider is being appointed and beneficiaries are free to continue using their Postbank accounts.

The department also retains the capacity to assist clients if they wish to switch banks.

“Let us assure that our actions and ways reflect this reality,” Tolashe said.

“Beneficiaries will continue to receive their grants. Postbank remains a functioning bank. No new service provider is being appointed. No client needs to move to another bank unless they themselves choose to do so.”

SASSA continues to work closely with the South African Reserve Bank to ensure the security of social grant payments and remains committed to clear communication with beneficiaries.

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