SACP calls for action against social grants abuse
Johannesburg - Tuesday, 22 October 2013
The South African Communist Party (SACP) calls for firm and decisive action against abuse of the social grant payment system. The SACP calls upon government to urgently review and possibly cancel the Cash Paymaster Services (CPS) contract.
The Communist Party has noted with concern reports suggesting that there is an abuse of social grants payment system through unsecured and reckless lending practices to the elderly and other recipients of social grants, perpetuated by some micro lenders in active collaboration with the social grants payments distributor, Cash Paymaster Services (CPS).
CPS is reportedly selling the state's social grant database to micro lenders who then advance loans to social grant recipients, among others for cellphone airtime and funeral insurance. CPS is allegedly playing the role of an intermediary doing "marketing" for micro-lenders through selling them social grant database, thus profiteering through the exploitation of state information. The company is allegedly effecting deductions from social grants recipients when making their payments. This constitutes one of the worst forms of exploitation of the poor and the indigent.
The SACP has consistently raised alarm bells about the predatory practices of most of the lending institutions that offer credit facilities to impoverished and vulnerable communities. We have noted the rise in the prevalence of the granting of such debt in the recent past and have warned of the adverse consequences that such would have on the working class and the poor.