The size and importance of social grants to South Africa’s poor – both in terms of providing a lifeline, and in terms of connecting otherwise marginalised people – means that much is said and written about the efficacy of the process. The objectives of this study – commissioned by FinMark Trust, and undertaken by Progressus Research and Development – were to have a better understanding of who receives the grants, how it contributes to their well-being and how different payment methods affect the experience of grant recipients.
The study challenges the generality of some of the common anecdotes around social grants and confirms others. One of the surprises of the study is how little difference the payment method – cash or electronic – makes in terms of the time taken to collect the grant and the extent to which the one method offers clear benefits over the other. Another is that beneficiaries in the urban and rural areas are relatively better catered for than those in the peri-urban areas. This last reflects the realities of a rapidly urbanising population with high unemployment rates.
Use of financial services remains very low – amongst all grant recipients – but also those who are paid through electronic means (via a “bank account”). The low usage of financial services occurs because recipients have no money left at the end of each month, but also because they are uncertain as to the consequence of saving even small amounts in their grant accounts. The study suggests that there is significant room for innovation in terms of the facilities offered to grant recipients and in terms of how recipients are informed and educated.
The study also suggests that as the electronic payment method becomes more pervasive, and the ease of distribution of payments improves for the authorities, there is a need to consider ways whereby the benefits of the social aspects of the cash payment mechanism – as well as its ability to deal with the elderly – are not entirely lost.
The study confirms that the grant process is effective, that grant recipients are grateful for the difference it makes in their lives, and that tax-paying South Africans who contribute in this way to the lives of the poor have much to be proud of.
The post The Payment Experiences of Social Grant recipients appeared first on Finmark Trust.
