This order therefore clarifies that recipients may continue to initiate debit order instructions with any service provider, including the Net1 and its subsidiaries, against their bank accounts for the payment of goods and services. In accordance with industry practice, recipients may also query and request the reversal of disputed debits.
SASSA, its CEO and the Minister of Social Development were ordered to pay the costs of the application.
In 2016, SASSA challenged the company’s ability to operate certain aspects of its financial services businesses in a commercial manner by adopting an interpretation of the Act and Regulations that would prohibit the company and Grindrod Bank from processing debit orders from social welfare recipients’ bank accounts. The company believed that SASSA’s interpretation was erroneous and, on June 3 2016, it filed for a declaratory order with the High Court to provide certainty to Net1, as well as other industry stakeholders, on the interpretation of the Act and Regulations. The Court heard the matter on 17-18 October 2016 and judgment was handed down 9 May 2017.
The Court refused the Black Sash Trust’s application to intervene in the matter. In support of its application, the Black Sash made several allegations of ‘illegal deductions’, which were comprehensively dealt with in the company’s answering affidavits.
Recently, the Black Sash and the Democratic Alliance have been quoted in the South African media, stating that they had received a large number of complaints from recipients regarding ‘deductions’ from their grants. The company addressed correspondence to both the DA and Black Sash to seek further detail regarding these alleged complaints in order to investigate. In response, the DA said that it had received 600 complaints since inception. The company has asked for further details in relation to these alleged complaints, but has received no further reaction from the DA. The Black Sash failed to respond at all. The company invites any grant recipients who have experienced any issues with their grants to contact the company’s call centre at 0800-600-160.
“We welcome this order, as it clarifies that grant recipients may continue to exercise their human rights to transact freely with any service provider utilising the full functionality of their bank accounts,” said Serge Belamant, CEO of Net1. “We will continue to facilitate duly authorised payments for financial services and other products and reiterate that we do not initiate any ‘illegal deductions’. As verified by KPMG, in its recent factual findings report, our debit orders have no preference over other debit orders, are submitted through the national payment system and are randomised in accordance with industry practice,” he concluded.
The complete judgment is available on the company’s website here.
