Net1 Announces 12 Month Contract with SASSA
March 27 2009 - 8:16AM
Marketwired
Net 1 UEPS Technologies Inc. ("Net1" or the "Company") (NASDAQ:
UEPS)(JSE: NT1) today announced that it has agreed the terms of a
one year contract with the South African Social Security Agency
("SASSA") for the payment of social welfare grants in the five
provinces where it currently provides a grant payment service. The
current service level agreements ("SLAs") will automatically
terminate on March 31, 2009. The new contract will commence on
April 1, 2009 and expire on March 31, 2010.
SASSA has received special approval from the South African
National Treasury Department to conclude new agreements with the
current service providers for a twelve month period without
conducting a tender process. SASSA has indicated that a new tender
process will be initiated during the next twelve months.
The Company and SASSA have agreed on a standard pricing formula
based on a transaction fee per beneficiary paid, calculated on a
guaranteed minimum number of beneficiaries. In addition, SASSA will
assume responsibility for the pre-funding of all social welfare
grants with effect from the May 2009 pay cycle.
Serge Belamant, Chairman and CEO of Net1, said "We are satisfied
with the new contract terms as the combination of the dilutive
effects that arise from the standardized pricing, the savings which
are achievable by Net1 as a result of these changes and the
resultant business opportunities that open up for Net1 are likely
to lead to a financial outcome consistent with our existing
business plan for the year."
About Net1 (www.net1ueps.com)
Net1 provides its universal electronic payment system, or UEPS,
as an alternative payment system for the unbanked and under-banked
populations of developing economies. The Company believes that it
is the first company worldwide to implement a system that can
enable the estimated four billion people who generally have limited
or no access to a bank account to enter affordably into electronic
transactions with each other, government agencies, employers,
merchants and other financial service providers. To accomplish
this, the Company has developed and deployed the UEPS. This system
uses secure smart cards that operate in real-time but offline,
unlike traditional payment systems offered by major banking
institutions that require immediate access through a communications
network to a centralized computer. This offline capability means
that users of Net1's system can enter into transactions at any time
with other cardholders in even the most remote areas so long as a
portable offline smart card reader is available. In addition to
payments and purchases, Net1's system can be used for banking,
health care management, international money transfers, voting and
identification.
The Company also focuses on the development and provision of
secure transaction technology, solutions and services. The
Company's core competencies around secure online transaction
processing, cryptography and integrated circuit card (chip/smart
card) technologies are principally applied to electronic commerce
transactions in the telecommunications, banking, retail, petroleum
and utilities market sectors. These technologies form the
cornerstones of the "trusted transactions" environment of Prism, a
South Africa-based subsidiary of the Company, and provide the
Company with the building blocks for developing secure end-to-end
payment solutions.
In late August 2008, Net1 acquired 80.1% of BGS Smartcard System
AG ("BGS"), an Austrian company, whose core business consists of
developing and integrating smart card-based offline and online
financial transaction systems. Since 1993, BGS has implemented
tailor-made smart card-based payment solutions, focusing on
emerging economies and in cooperation with banks, enterprises and
government authorities. BGS is headquartered in Vienna, Austria,
and has subsidiaries in India and Russia, and a branch office in
the Ukraine. Distributors are located in Asia, Central and South
America, the Commonwealth of Independent States and the Middle
East.
Forward-Looking Statements
This announcement contains forward-looking statements that
involve known and unknown risks and uncertainties. A discussion of
various factors that could cause the Company's actual results,
levels of activity, performance or achievements to differ
materially from those expressed in such forward-looking statements
are included in the Company's filings with the Securities and
Exchange Commission. The Company undertakes no obligation to revise
any of these statements to reflect future circumstances or the
occurrence of unanticipated events.
NET1 UEPS TECHNOLOGIES INC.
4th Floor, North Wing,
President Place, Cnr. Jan Smuts Avenue and Bolton Road
Rosebank, Johannesburg, South Africa
Tel: 011-27-11-343-2000 Fax: 011-27-11-880-7080
Contacts: Net 1 UEPS Technologies Inc. William Espley Investor
Relations (604) 484-8750 or Toll Free: 1-866-412-NET1 (6381)
Website: www.net1ueps.com
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