Belamant, who spoke to analysts on Friday, 5 May 2017, about Net1's quarterly results to end-March 2017, said the past few months had been challenging, "aggravated by the tarnishing of our reputation and questioning of our business practices due to frivolous and unsubstantiated public attacks".
These are the first public comments he has made since the Constitutional Court ruling on 17 March, which set the terms on which Net1 subsidiary Cash Paymaster Services (CPS) has to continue to pay social grants until the end of March 2018. By this date the South African Social Security Agency has to have appointed a grants distributor.
While there has been public support for involving the agency with key support from the Post Office and backing from banks, Belamant's plans support rumours of an alternative being developed by advisers backed by Social Development Minister Bathabile Dlamini.
Sources at the agency said on Friday that it was working to meet the court's ruling, but there were signs the work teams appointed by Dlamini were working separately on a proposal that might include CPS.
On Friday Belamant outlined plans that included the possible introduction of a new black economic empowerment partner to Net1. "Or possibly a private-public partnership and then completely separate grant distribution from the provision of financial services," he said. The partner should ideally have the "right credentials regarding black empowerment as well as facilitate economic transformation". Belamant said Net1 would continue to support this partner.
However, he may have problems as his plans do not seem to be in line with the court's ruling. At the weekend the agency's CEO Thokozani Magwaza said, "CPS was CPS in whatever guise. The court has pronounced on the matter?"
Looking beyond the grant-related operations, Belamant said the group's financial services business in SA had grown "meaningfully" and the only barrier to continued growth was the reputational damage it had suffered. He was now looking to FIHRST, the group's payroll management business, as a channel for selling financial products and services Net1 had been selling to social grant beneficiaries. FIHRST manages wage payments to more than 800,000 employees on behalf of about 2,000 employers.
"These are not welfare recipients and are ideal targets for our financial products."
Customers would generate four times more revenue than welfare beneficiaries when taking into consideration fee income and sales, he said.
Also on the horizon is the multibillion-rand investment in Cell C and Blue Label. Chief financial officer Herman Kotze said Net1 expected to make substantial progress towards completion of the deal by the June financial year end.
On Friday, investors seemed unconvinced by the upbeat presentation. The share closed 4% weaker at R136.54.
Source: Business Day
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