Postbank handed another 12 months to solve its security issues

The underfire South African Post Office has been given until the end of 2023 to ensure its house is in order.

Per a report carried out by Business Insider South Africa, the state-owned Postbank will not be kicked out of the national payment system, says the Reserve Bank.

Operated by the South African Post Office, Postbank has instead been granted another year, up to mid-December 2023, to plug the gaping security holes behind problems with payment cards it issued on behalf of the SA Social Security Agency (Sassa), first spotted in February 2019.

According to the Reserve Bank, which is the guardian of the national payment system, had first ordered the beleaguered Postbank to get its security up to the standard it demands from other banks by the end of March 2021.

However, nine months later, the Postbank had failed to comply forcing the Reserve Bank to issue another ultimatum, with a deadline this month.

Shortly before that expired, Reserve Bank governor Lesetja Kganyago pushed the deadline out again, saying the delay in action against the Postbank  “would be in the best interest of the safety, integrity, effectiveness, and efficiency of the [national payment system], as well as in the public interest.”

“The Postbank has cooperated and demonstrated its commitment to remedy the non-compliance, particularly through swift initiation of the project following the lifting of the moratorium on the project, and ongoing engagement with the SARB on the progress made in implementing the conditions of the variation notice,” said the Reserve Bank.

The Reserve Bank has also described “serious irregularities” in the South African Social Security Agency (Sassa) cards, referring to what the media reports suggested that there has been theft that compromised 12 million cards.

“The Reserve Bank demanded that the Postbank secures its keys, complies with global security standards, and sets up disaster recovery infrastructure, among other conditions of continued access to the national payment system, without which the Sassa cards would be effectively unusable,” reports Business Insider SA.

“The Postbank has been making progress, said the Reserve Bank, but a moratorium imposed on its information technology work – only lifted in June 2022 – would see it miss its deadline.”