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SA’s poor use bank account as mailbox for social grants

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Social grant holders use their bank account as a mailbox from which they withdraw the money that has been transferred from Sassa, which implies they rarely use their bank accounts as a store of value, explains Farai Muronda.

The grant distribution system has a tremendous impact on how the poorest South Africans interact with the financial services system. Financial inclusion of the poor, measured by the extent to which they have access to and make use of financial products, was boosted greatly in South Africa by the decision to distribute grant payments digitally.

As the South Africa Social Security Agency (Sassa) considers a new solution for the payment of grants, it is important that any such solution maintain and build on the financial inclusion of beneficiaries achieved thus far and encourages more beneficial use of bank accounts and other financial services.

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