The National Student Financial Aid Scheme (NSFAS) has called on students who do not have bank accounts to open new ones, saying it will pay allowances directly into those accounts from May.
The beleaguered public bursary scheme, which is under administration, made the announcement on Friday.
“NSFAS has devised a payment mechanism to address these ongoing challenges with the assistance of its banker,” NSFAS said in a statement.
“In terms of the mechanism, NSFAS will distribute allowances directly to students’ bank accounts.”
Meeting with students’ organisation
The announcement, it said, follows an urgent meeting between the scheme’s newly appointed administrator, Freeman Nomvalo, and students leaders. The leadership of the South African Technical Vocational Education and Training Student Association (Satvetsa) met with Nomvalo on Tuesday.
“The students expressed serious concerns about the efficacy of the current mode of disbursing allowances,” the scheme said.
“NSFAS is aware of the persistent challenges experienced by some students with the April allowances. …These have already been disbursed.
“The scheme has deployed senior NSFAS officials and servicing administrators to all affected institutions. This is to address these challenges.
“NSFAS is also attending to the challenges of students who may not have received their allowances. This …so that the new mechanism is not burdened by legacy issues.”
New arrangement from May
The payment arrangement is only for TVET students, said NSFAS. University students will continue to receive allowances through their institutions until July.
“Students who were paid on the direct payment platform until April should continue to use those funds.
“The new arrangement is only from May onwards. More communication will be sent on the off-boarding process,” the scheme said.
Nomvalo assured all NSFAS-funded students that the scheme will put the interests of students first in any decision it takes.
Service providers’ contracts cancelled
It has hardly been two years since NSFAS piloted its payment system of paying student allowances through direct payment providers. The system has since been cancelled.
The direct payment system was first piloted at TVET colleges in 2022. Satvetsa rang alarm bells on the challenges with the payments system. It said the service providers did not have the capacity to do the job.
Satvetsa said the problems with the payment system were flagged in 2022. But they were only taken seriously when the roll-out was extended to university students.
NSFAS cancelled the contracts of four direct service providers, eZaga, Noracco, Coinvest, and Tenet Tech. This after an independent investigation found irregularities in the awarding of the contracts. The investigations were carried out by law firm Werksmans Attorneys and Advocate Tembeka Ngcukaitobi SC.
About 1.2 million students in TVET colleges and universities are funded by the scheme.
