Cape Town – The Postbank has reported a net loss of two billion rand for the 2022/23 financial year, citing the costs associated with paying social grants as a significant factor.
According to its annual report tabled in Parliament this week, the bank, which took on the responsibility of paying social grants to over seven million recipients a year ago, faced financial challenges related to this contract, EWN reported.
In the annual report, Postbank’s CEO, Nikki Mbengashe, said that substantial financial resources were allocated towards manpower and supplementary services to facilitate physical cash payments.
She emphasised the considerable expenses incurred in ensuring that both post offices and more than 1 000 payment locations had adequate cash reserves to process the payments.
Despite the reported loss (compared to a profit of R302 million the previous year), the bank asserts its solvency based on the value of its assets.
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The Auditor-General has raised concerns about the credibility of the bank’s financial information, citing a lack of sufficient credible data for an audit finding.
The Postbank is currently in negotiations with Sassa to potentially transfer some of the physical cash payment responsibilities, the report said.
On Tuesday, several Postbank branches in KwaZulu-Natal experienced a cash shortage, prompting a call for social grant recipients to use ATMs and retailers for withdrawals.
The shortage affected 43 outlets, and this issue came after a previous software glitch left many beneficiaries without funds, News24 reported.
Postbank’s spokesperson, Bongani Diako, said that only 6% of beneficiaries used the Sassa gold card issued by Postbank, which could function like any other bank card.
MEDIA STATEMENT:
KZN SASSA Beneficiaries urged to collect Money at ATMs and Retailers #SocialGrantPayments #SASSACARES @The_DSD@Postbank_ZA @nda_rsa @GCISMedia @GovernmentZA pic.twitter.com/XfWAzxc8eA
— SASSA (@OfficialSASSA) October 3, 2023
As a result of cash delivery delays, many Post Office branches in KZN anticipated having insufficient cash.
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Picture: Twitter/@PostofficeSa
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Compiled by Betha Madhomu
