My current book project, Bantustan Banking: Debt, Race and Welfare in South Africa, shows how a cash transfer program became the vehicle for the state financing of racial finance capital under the guise of liberal democracy. Often conceptualized as heralding a desired future of more equitable distribution, cash transfers are not value-neutral monetary instrument but political technologies of state power.
South Africa has the largest social assistance program in the world by GDP, supporting 18 million citizens, 85% of whom are Black women. Based on three years of ethnographic fieldwork, I argue that from 2012-2018 the South African Social Security Agency (SASSA) outsourced grant payment to a private corporation, Net1 Technologies (NET1), which used their monopoly over biometric data to segregate Black women grantees into an alternative digital banking system – what I call a Bantustan banking system – on highly unequal terms. Within this segregated banking space, grantees were compelled to use their government grants as collateral for high-interest loans in the name of moral improvement and progress.
While cash transfers are designated for individuals – the elderly, caretakers of children, and people with disabilities – they form the only income available for households and families. This paradox drove recipients toward money lenders, and credit became the only means of caring for a household on an individual grant. When grantees accrued debts, exactly as the welfare system encouraged them to do, Black women were refigured not as deserving subjects of grants but underserving subjects of debt.
My interlocutors questioned the debts levied on their grants, asking, “who really owes what to whom?” In so doing, they repositioned themselves not as debtors but as net creditors to the nation, whose land, labor and lifeways were stolen across generations. Their redistributive demands were not just about asserting their right to a small monthly stipend which is easily paid under prevailing economic conditions, but imagining far more radical forms of liberation and economic transformation.
Torkelson E (Forthcoming) "Sophia's Choice: Debt, Welfare and Racial Finance Capital in South Africa." Environment and Planning D: Society and Space.
Torkelson E (2020) "Collateral Damages: Cash Transfer and Debt Transfer in South Africa." World Development 126.
"Social Grants: Challenging Reckless Lending in South Africa." The Burning Issue, Voice of the Cape, 29 September 2020.
“Social Grants and the Green Card.” Cutting Edge, SABC, 27 March 2018. Researcher and script writer with Esley Philander, Colleen Crawford Cousins, and Johan Abrahams.
“Deductions from Social Grants: How it All Works.” Daily Maverick Podcast, Cliff Central Radio, 7 March 2017.
James D, Neeves D and Torkelson E. "Social Grants: Challenging Reckless Lending in South Africa." Black Sash Report.
Torkelson E, James D, and Neves D. "Legal but Reckless: Lending to Social Grant Recipients." GroundUp, 29 October 2020. Republished: Daily Maverick, News24, The Witness (pg 6)
“The World Bank’s Role in SA’s Social Grant Payment System.” GroundUp, 23 March 2017. Republished: Mail and Guardian, Daily Maverick, Fin24, TimesLive, AllAfrica
“Sophia’s Choice: Farm Worker has to Decide which Child to Feed.” GroundUp, 15 March 2017. Republished: Daily Maverick, TimesLive, IOL
“Deductions from Social Grants: How it All Works.” GroundUp, 3 March 2017. Republished: Huffington Post
Torkelson E with GroundUp Staff. "Social Grants: Has Belamant Answered His Critics?" GroundUp, 9 May 2017.
In The News
Ho, Ufrieda. "The Vicious Cycle of the Debt Trap Fallen Into by Social Grant Recipients." Daily Maverick. 23 October 2020.
Githathu, Mwangi. "Loan Sharks Feasting on the Poorest by Charging Interest of 50-112%." Cape Argus. 20 September 2020.
Stent, James. "Report Shows how Lenders Prey on Social Grant Recipients." GroundUp. 16 September 2020.
Rees, Malcolm. "The Human Cost of South Africa's Unsecured Lending Explosion." GroundUp, 13 February 2020.
Gentilini, Ugo. "Social Protection Papers of the Year." World Bank Blogs, 19 December 2019.
Webb, Chris. "The Roots of the Current Crisis in South Africa." Africa is a Country. 14 March 2017.