NT1 - Net1 - Net1 to Approach Constitutional Court in Response to Supreme Court

NT1 - Net1 - Net1 to Approach Constitutional Court in Response to Supreme Court 
Ruling                                                                          
Net 1 UEPS Technologies, Inc.                                                   
Registered in the state of Florida, USA                                         
(IRS Employer Identification No. 98-0171860)                                    
Nasdaq share code: UEPS                                                         
JSE share code: NT1                                                             
ISIN: US64107N2062                                                              
("Net1" or "the Company")                                                       
Net1 to Approach Constitutional Court in Response to Supreme Court Ruling       
JOHANNESBURG, March 25, 2011 - Net1 UEPS Technologies, Inc. ("Net1" or "the     
Company") (NASDAQ:UEPS; JSE: NT1) today announced that its wholly owned         
subsidiary, Cash Paymaster Services (Proprietary) Limited ("CPS"), intends to   
apply for leave to appeal the South African Supreme Court of Appeal`s recent    
judgment on March 11, 2011, which overturned a lower court judgment delivered on
December 10, 2009, prohibiting the South African Social Security Agency         
("SASSA") from contracting the South African Post Office ("SAPO") to render     
banking or payment services relating to social grant beneficiaries. The lower   
court, the North Gauteng High Court, had ruled in a suit commenced against SASSA
by CPS that SASSA had not followed a proper procurement process to comply with  
the South African Constitution and the Public Finance Management Act ("PFMA")   
when the previous executive management team at SASSA contracted with SAPO for   
the payment of grants in 2009.                                                  
Net1 believes that the final outcome of the case could have a significant impact
on broader interpretation of government procurement laws in South Africa and in 
particular the application of section 217 of the South African Constitution and 
section 51(1)(a)(iii) of the PFMA which prescribes a fair, equitable,           
transparent, competitive and cost effective procurement process.                
During 2010, CPS filed a similar suit against SASSA, with regard to contracts   
SASSA entered into with certain commercial banks. In this instance the North    
Gauteng High Court also ruled in favour of CPS by finding that the procurement  
process followed by SASSA was not adequate. SASSA did not appeal this judgment  
and it remains effective.                                                       
On March 13, 2011, the South African newspaper, The City Press reported that CPS
and other contractors charge SASSA an average of R32.11 per transaction, which  
the article stated is more than twice that charged by the South African Post    
Office. Despite the inaccuracies of the reported prices, at least in regard to  
CPS` prices, the article failed to mention that the price charged by SAPO is for
the delivery of welfare grants through magnetic stripe based bank accounts      
opened at SAPO branches, predominantly located in urban areas of the country. In
contrast, CPS delivers social welfare grants in all areas, but primarily in deep
rural areas, using secure biometric-based smart card technology, guarded mobile 
payment vehicles and equipment, and through biometric point of sale devices     
installed at medium, small and micro merchant enterprises. SASSA issued a tender
for the payment services in 2007, but decided to cancel the tender after a long 
and drawn out process, which decision is currently also the subject of a review 
application launched by CPS. Notwithstanding the aforementioned, CPS`s average  
rate per recipient on a national basis quoted in its tender submission in the   
now cancelled tender, was more competitive than the contract price agreed       
between SASSA and SAPO.                                                         
CPS remains one of the incumbent service providers to SASSA and our existing    
Service Level Agreements with them remain in effect. CPS continues to deliver a 
high quality service to SASSA and provide the most suitable solution tailored to
the various challenging environments where the most vulnerable South African    
citizens reside.  Until the finalization of the appeal process, the judgement   
granted by the North Gauteng High Court on December 10, 2009 remains in full    
force and effect and prohibits SASSA from contracting with SAPO to render       
banking or payment services relating to grant beneficiaries, until SASSA follows
a proper procurement process which complies with the Constitution and the PFMA. 
SASSA is, however, not prevented from issuing a new tender in the interim in    
which SAPO could participate, and which would allow SASSA to select the most    
cost effective and efficient system available.                                  
Forward-Looking Statements                                                      
This announcement contains forward-looking statements that involve known and    
unknown risks and uncertainties. A discussion of various factors that 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.         
About Net1 (www.net1.com)                                                       
Net1 is a leading provider of alternative payment systems that leverage its     
Universal Electronic Payment System, or UEPS, to facilitate biometrically secure
real-time electronic transaction processing to unbanked and under-banked        
populations of developing economies around the world in an online or offline    
environment. In addition to payments, UEPS can be used for banking, healthcare  
management, payroll, remittances, voting and identification.                    
Net1 operates market-leading payment processors in South Africa, Republic of    
Korea, Ghana and Iraq.. In addition, Net1`s proprietary Mobile Virtual Card     
technology offers secure mobile payments and banking services in developed and  
emerging countries.                                                             
Net1 has a primary listing on the Nasdaq and a secondary listing on the JSE     
Limited.                                                                        
Investor Relations Contact:                                                     
Dhruv Chopra                                                                    
Vice President of Investor Relations                                            
Phone: +1-212-626-6675                                                          
Email: dchopra@net1.com                                                         
Johannesburg                                                                    
25 March 2011                                                                   
Sponsor to Net1                                                                 
Deutsche Securities (SA) (Proprietary) Limited                                  
Date: 25/03/2011 15:30:02 Supplied by www.sharenet.co.za                     
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