16/03/2017 06:35 GMT | Updated 16/03/2017 06:44 GMT

AmaBhungane Investigation Reveals Net1 Has Been Selling Social Grantees' Data To Subsidiaries

After years of denying the claim, a new investigation says Net1 and CPS are using grantees' data to sell them other financial services.

AFP/Getty Images
A member of the South African Human rights Non Governmental Organisation Black Sash holds a placard outside the South African Constitutional Court during an hearing brought forward by various organisations on the possible failure of the South African government in meeting the deadline for Social Grants payment on March 15, 2017 in Johannesburg. The payment had for years been outsourced to a private company Cash Paymaster Services (CPS), whose contract expires at the end of March. Fears have mounted in recent days that the government might fail to pay the monthly grants from April after it failed to announce alternative arrangements. South Africa's welfare system was plunged into chaos in 2014 when a court ruled that the contract of the current distributor, Cash Paymaster Services, was granted illegally. / AFP PHOTO / GIANLUIGI GUERCIA (Photo credit should read GIANLUIGI GUERCIA/AFP/Getty Images)

Despite denying the charge under oath, an amaBhungane investigation has revealed how Net1, parent company of Cash Paymaster Services (CPS), uses the personal data of social grant beneficiaries, collected by CPS to market its subsidiaries' products to the poor and vulnerable.

Net1 and CPS have reportedly denied this for years, in spite of several accusations that it was doing this.

On Wednesday, amaBhungane reported that it appears as if Net1's subsidiaries are targeting Sassa grantees exclusively to sell them airtime, insurance, loans and more. CPS is strictly forbidden from sharing the data it collects with any third parties.

For example, in the case of The Smart Life Insurance, a Net1 subsidiary,a Net1 salesman interviewed by amaBhungane said he and two Net 1 colleagues have to drive to a rural Sassa pay point every month to sell Net 1's products.

The car they use is reportedly "branded with CPS, Smart Life, Moneyline and Net 1 logos.".

The salesman told the investigative unit that only Sassa beneficiaries could buy Net 1's products.

A Sassa cardholder interviewed by amaBhungane applied for a Moneyline loan – another Net1 beneficiary.

AmaBhungane reported that the Net1 printout from that transaction included the line: "I hereby authorise Moneyline to access my bank account transaction history for the purposes of approving my loan request."

This is in stark contrast to what Net1 CFO Herman Kotze recently told the Pretoria High Court. He said that Net 1 and Moneyline "do not have, and do not seek, access to the beneficiaries' accounts", amaBhungane reported.

The salesman also reportedly said that now that the CPS contract is ending, the staff are under pressure to get as many grantees onto Net1's books as possible.

The Black Sash this week petitioned the Constitutional Court to continue its oversight role of the issuing of a new tender to roll out social grants.

Read the full investigation here.