Over 65,000 South African Social Security Agency (SASSA) beneficiaries have been temporarily transferred to First National Bank (FNB) following the pending provisional liquidation of Ithala Bank. The affected grant recipients were left unable to access their funds after Ithala’s operations were frozen nearly two weeks ago.
In a statement, SASSA confirmed that it has partnered with FNB to open interim accounts for the beneficiaries. Grant recipients now have three months to provide SASSA with their preferred banking details for future payments.
The majority of those affected are based in KwaZulu-Natal (KZN), while smaller numbers reside in Mpumalanga, the Eastern Cape, Gauteng, the Free State, North West, and the Western Cape.
Government Response and Concerns
During a media briefing on Tuesday, KZN Premier Thami Ntuli expressed surprise at SASSA’s decision to collaborate with FNB without prior consultation.
“I am not aware of SASSA’s decision to work with FNB for Ithala clients who are SASSA beneficiaries. I will follow up on this matter,” said Ntuli.
Economic Development MEC Musa Zondi raised concerns about account holders’ inability to access their funds since Thursday.
“Since Thursday, if you have a card or an account, you can’t withdraw or transact. That is concerning because the money does not belong to the bank. People’s funds are being withheld, and I would venture to say it is illegal,” said Zondi.
Ithala’s Legal Battle
Ithala is preparing for a crucial court hearing on Thursday as it fights to avoid liquidation. The Prudential Authority has deemed the matter urgent, citing the need to protect the funds of over 200,000 depositors.
The situation remains critical as thousands of affected beneficiaries await clarity on their financial future while Ithala’s legal battle unfolds.
