Child Protection Organizations
Wage payment software
The software we develop to be used by companies that are paying out wages will also become a strategic tool to help child protection organizations.
The wage payment software that we will develop is a simple solution to help feed thousands of lower income people.
To understand the mechanics of this business model, we need to explain how financial institutions ask food companies large amounts to bank cash. There are also additional costs involved in transporting cash from the premises to the banks with “cash in transit” companies.
Food companies are always looking for ways to reduce the number of cash-intakes. They started to include services where consumers can withdraw cash from their cashiers and not from the banks. It is better for them to get as much cash out of the store as possible. Remember that it takes up time from the cashier to help a person with cash-withdrawals. Time that could have been used to support the next customer with his/her groceries.
Food companies also started to implement digital vouchers concepts. The digital voucher is worth much more to a food company than to receive cash from customers.
With a digital voucher, the food company knows that the entire amount must, and can only be spend at the company. They do not give change to the customer if the customer purchase products for less than the digital voucher.
Food companies however support customers with larger digital vouchers to transfer the credits onto gift-cards that can be used as a debit card. The gift-card can also not withdraw cash, but it can be used multiple times to pay for products.
“Cash” is a commodity that the banks do not even want to administrate. The problem is that it is almost impossible to eliminate cash as a trading tool. Banks also try to erect as many “cash accepting” ATM machines as possible. The banks want to reduce the number of people that visit the banks and que to bank cash into their accounts.
Banks often charge a minimum fee of R45 plus a sliding scale to bank a company’s cash into the company’s account. Accepting cash is labour intense. The cash must be counted multiple times. There must be controlled mechanisms in place to ensure that staff also do not attempt to take these cash.
It is furthermore also expensive for an Employer to withdraw cash in order to pay wages. All these factors are taken into consideration to build a software structure that will help child protection branches.
Food companies offer discounts when they can sell digital vouchers in bulk. The average discount structure is as follow:
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R0 - R2500 in vouchers – 2% discount
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R2500 – R50 000 in vouchers – 2.5% discount
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R50 000 plus in vouchers – 5% discount
The Homecare team knows that if we can only use 1% of the discount out of 500 000 low income people, that we will already be able to support child protection branches.
It is better to filter the additional 4% discount down to the labourers. They will be able to buy more groceries if there is a way where they can receive the 4% discount.
Software structure:
We develop a web-based platform where companies can upload their personnel file, and the value of the digital vouchers that each employee must receive.
The company then do an EFT payment of the total grocery bill into a trust account that the Homecare Foundation will manage. The funds will immediately (Within seconds) be converted into digital vouchers and be delivered on to labourer’s cell phone.
There are also huge drives to encourage wage earners to open bank accounts. The cost to own a bank account has been reduced by banks such as Capitec. The problem remains that even Capitec will not provide their client base a free or low-cost internet banking service. Customers in general has to pay a fairly large amount to be able to use internet banking services.
There is therefore always wage earners who do not own a bank account. The only way they can be remunerated is via “Cash”.
Our objective is to include a section in the “Wage payment” software where companies can do a “Cash send” to employees via the technology. The labourer will then receive 2 SMS messages. One with the digital voucher that he can redeem at food supplying companies, and the other one where he can withdraw cash from an ATM.
Our decision to only use 1% of the 5% discount out of LSM 2 income people creates new opportunities to help feed the poor.
Benefit for companies
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There are use risks and costs to arrange that cash can be delivered to the premises so that wages can be paid in cash. Companies often pay cash-in-transit security companies large amounts just to arrange that cash can be delivered at the premises to pay out wages. The risk of being attacked by armed robbers is high.
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Most companies are looking for ways to get the maximum value/benefits for their employees. This project enables us to help a wage earner (in manufacturing) to receive up to R250 more per month when the employee converts a percentage of the wage into grocery vouchers. (Obviously the company will first explain to labourers the benefits. All the labourers use a percentage of their wages to buy groceries anyway. Remember that the labourer can buy anything, including alcohol from the food company’s Liquor stores)
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R250 may sound like a small amount, but for a labourer this is a huge financial benefit.
R250 may also not seem to be a lot for a company, but if you consider that there are companies that employ more than 2 000 labourers…. The financial gain, without spending money will then be R500 000 per month.
Costs of getting money into bank accounts
It is important to understand how banking and security costs influence businesses. It may sound unbelievable, but companies hate cash… Nobody really wants to get paid with cash.
The costs to transport cash to banks, plus the banking fees when companies bank the cash is extremely high. Banks now offer ATM cash deposit services to try and reduce the number of people inside the bank who want to use tellers when they want to deposit cash into bank accounts.
The ATM machines are the low-cost way to deposit cash into a bank account. FNB for example ask R4.10 plus R0.90 per R100 thereafter to accept cash deposits. If you bank cash inside the bank via their staff, the cost is a minimum fee of R45 for a transaction.
Cashless transactions, meaning debit and credit card payments also cost the companies money. Companies pay up to 5% just on credit card fees and 1.5% on debit card fees to collect money from their customers.
This project where the Homecare Foundation pay funds on behalf of thousands into the food company’s bank account, is the best way for the food company to get money for groceries. The recipient (food company) does not pay any fees (NUL) when funds are transferred via EFT.
It is only the person paying that have transaction costs, but that is a small amount, because it is an EFT transaction.
Our understanding of how we can use a cost saving module, plus our knowledge of how to develop specialized software can in future be compared the miracle of feeding thousands with almost nothing.
Readers should know that we develop this platform to help increase our financial support towards child protection organizations. In our Grocery purchase planning module to be next explained, we present a business plan where we will interact with 500 000 low income people.
Our software structures and using well trained fundraisers to target businesses in other industries will at least ensure that we can fulfil our targets. We might even reach 4 million low income people when we approach companies in South Africa to use the wage software.
Additional support towards farmers
Readers should know that every software platform we develop, is somehow integrated with other software structures that we prepare for child protection organizations.
The personnel recruitment software for example is interlinked with the Enjoy Life app software and it is also interlinked with the Wage payment software.
The recruitment software is also refined to help farmers with functions that we believe will in future help labourers.
The following explain:
A farmer will in future be able to use his Enjoy Life app and on his phone he will for example plan a “message posting” for the following morning. He might need 35 “temporary labourers” who are able to help with pruning the win yards. He will select on his phone on a Google map where his truck will be the following morning to pick up labourers. Let’s for example say Klapmuts in Western cape.
The technology will first invite the labourers the farmer usually works with. But the farmer might need more than usual, so the software will invite unemployed people who have certain skills to accept the offer for the day.
The personnel recruitment software will enable any person, including people without any formal education to register themselves on the website. It is a support service that even social workers will one day tell people to use. If you have a cell phone number, you can ask another person to register you in an area, with your basic skills. You can receive invitations for work, even if it is only temporary work. People within the community will help unemployed persons who at least want to work, to register. We prepare for the future. There are lots of groups that focus on providing internet access to rural communities, so it makes sense for us to develop so that we will be ready to help the poorest of the poor.
We combine old and new technology. Most of the people will not have the Enjoy Life app on their phones. They will however be able to receive an SMS and that is all we need.
We know that farmers will use the Wage payment software to increase the value of the funds they spend on labour.
Child protection teams should know one thing… God is in control… We will one day help thousands and thousands of people to get a little bit more for groceries. This is one practical explanation of how miracles are still happening today.
The Homecare team will keep on working hard to help child protection branches become financially free of constraints. We will later explain all our other business strategies that will in future (3 to 4 years later) be implemented to keep on pushing the project into a direction that most people will think it was impossible to do.
Wage payment software to also support individual employees
The wage payment software will be offered to all categories of employment.
The next part of the software development we will explain is software that we develop for the churches and schools. We can via other technology spread the message that domestic workers can also be supported.
Our initial plan was to choose one food company group to support our wage payment software plan. We later decided that it will not benefit the caretakers of patients if we can only offer limited stores where groceries can be purchased.
It is also important to make it convenient to every person who we must help. We do not want a domestic worker to travel far distances just to be able to receive additional groceries.
We know that numerous church members will want to support their domestic workers. They can help these people without offering an increase in wages.
We want to explain with examples how a domestic worker can gain via the Wage payment software platform.
We need to look at the circumstances of domestic workers and take everything into consideration. Remember that most likely more than 80% of the domestic workers have families, meaning that they are not the only persons that earn wages. They usually have children under their care. The fact is that most domestic workers work to earn a wage, but they also rely on the Social Grants from Government to help them raise their children [Child Support Grant (12,196,981 beneficiaries). R380 per month to the main caregiver of a child 18 or younger. The applicant must earn less than R45,600 (if single) or R91,200 (combined income if married) per year.]
The minimum wage for domestic workers is R2 545.22 per month. The domestic worker will on average have access to her husband's income (might be a wage as well) plus on average 3 times R380 per child under her care. The immediate family might combined have access to more than R6 500 per month. What we want to explain is that the domestic worker might one day ask her employer to convert up to R2 500 per month on her behalf into digital vouchers to support her family. It is with today's food costs almost impossible to provide to a family of 5 with less than
R2 500 per month. R2 500 will barely be enough to purchase the basic essentials.
We also need to take other aspects into consideration. In most cases, the person that buy groceries for the family do this on almost a daily basis. Remember that these people do not own their own vehicles. They use taxis as transport and they tend to purchase a small number of items more regularly. To back this statement, we can use information published by the Shoprite group: https://www.shopriteholdings.co.za/
Our Group
We are the largest supermarket retailer on the African continent. Our Group is a R141 bn turnover business, with a staff complement of more than 148,000 people. We serve local communities with the lowest price promise. 35 million people shop in our footprint of more than 2,811 outlets every day.
Readers should take into account that there are numerous food supplying groups (Pick n pay, Spar, OK, numerous smaller independent companies and Spaza shops). It is important to understand that most salary earners might visit these types of businesses let’s say on average 6 times per month. We can purchase more products per visit and transport it home with vehicles. (Wage earners who we will support do not have this privilege to purchase in the same way most readers do.)
Our statement is that wage earners then also have additional costs to purchase groceries. If they withdraw cash from ATM machines, the cost is R8 (native machines via Capitec = lowest compared to all banks). Let’s say the person responsible to purchase groceries visit stores 20 times per month and only withdraw cash only 10 times per month. R80 of the funds they received are then allocated to bank fees, due to their circumstances. Most of the wage earners prefer not to carry large amounts of cash on them, fearing robbery. There is unfortunately a lot of people who are not well educated regarding financial management. Wage earners with debit cards might also pay with their cards. The debit costs per transaction = R1.50. This will result in R30 per month on banking fees.
There are two benefits:
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The domestic worker can earn an additional 4% on their grocery spending. It may not seem to be a large amount, but if you consider that the domestic worker needs to make a living with almost nothing, then every sent they can save or earn additionally will help. The Homecare team can pay out an additional R100.00 (4% of R2500) per month towards the domestic worker when we support them with the gift vouchers. The gift cards also have no banking costs, hence using it will not befall additional costs for the person. A number of wage earners will gain an additional R80 and others R30 per month.
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Having a voucher instead of cash is also beneficial. It is sometimes risky for people to go to shops with cash. Chances of getting robbed especially for older domestic workers is real. In this project, the domestic workers will transfer the amount on their digital vvouchers onto gift cards. They will then be able to provide the Employer the gift card numbers. The gift cards create an audit trail. If the card is stolen and the robber use it at the till inside a food store, the police can use TV surveillance to catch these robbers. The Food companies can determine at which till and on what date & time the last transaction occurred on the card. It will actually reduce crime on poor people.
The Grocery spending focus points, enable us to target a larger number of “Lower income” people.
Note that with our business plan, we can target even “Non-caring people” in the lower income categories. All that we rely on is that “caring” employees of domestic workers help us to provide better to their staff. The domestic worker (even in the red colour category) will obviously just want the additional benefit, without thinking about helping child protection. We explained in the Introduction section that the Enjoy Life phone app focuses on “green” people. This is applicable when people are asked to rate services in order for the Foundation to earn income from companies… It is explained under beverage sales.
Readers who want to save time, can now proceed to "Funds towards Child Protection"