Cash Paymaster Services (CPS) says it doesn't have enough cash to pay social grants in June.
CPS claims the South African Social Security Agency (Sassa) has not paid for its service to pay social grants in cash.
The controversial provider has now approached the Constitutional Court to break the impasse over how much it may charge for its services.
CPS says it only has enough cash reserves to last until the end of May, reports EWN's Lindsay Dentlinger.
CPS have stopped short of saying what's going to happen if they don't get money.— Lindsay Dentlinger, EWN reporter
This is largely a dispute that CPS is having with Treasury about what they should be paid.— Lindsay Dentlinger, EWN reporter
Since the court extended this CPS contract in March, CPS has not been paid.— Lindsay Dentlinger, EWN reporter
The contract between Sassa and CPS was extended until September earlier this year.
At the same time, Sassa has canceled the tender to find a service provider to pay recipients who receive their grants in cash.
This is apparently in order to review the tender process and ensure that it meets the legal requirements.
Take a listen to the EWN update:
This article first appeared on CapeTalk : CPS says there isn't enough money to payout cash grants