Repay loans, says student fund CEO
The CEO of the National Student Financial Aid Scheme Steven Zwane urged graduates on Tuesday with outstanding loans to pay back the money, warning that the institution could not afford to write off their debts.
National Student Financial Aid Scheme (NSFAS) CE Steven Zwane urged graduates with outstanding loans on Tuesday to pay back the money, warning that the institution could not afford to write off their debts.
NSFAS is under immense pressure to implement President Jacob Zuma’s surprise announcement on December 16 of free higher education for all first-time students from 2018.
Compounding the logistical challenges created by the president’s move, is the fact that at the last count, previous beneficiaries owed R29.81bn. While the NSFAS improved its collection rate in the 2016-17 financial year, it recouped only R392.4m, according to the scheme’s latest annual report.
The NSFAS uses the funds recovered from student loans to provide upfront payments to universities and Technical and Vocational Educational Training colleges, which allows them to waive registration fees for NSFAS-funded students.
The money is also used to support students who are partly funded by nongovernmental organisations, Zwane said.
The NSFAS had taken steps to improve its collection rate, including working more closely with government and private sector employers, and using the services of collection agencies, he said.
Zwane made his remarks during a visit by Deputy Higher Education Minister Buti Manamela, who toured the NSFAS’s facilities in Wynberg, Cape Town, to gauge its capacity to implement the new policy on free higher education.
The new policy raises the means test for qualifying for financial support from an annual household income of R122,000 to R350,000, and provides for students to receive bursaries instead of loans.
Manamela echoed Zwane’s appeal to graduates to pay back their NSFAS loans, urging them to “pay it forward” so that the next group of eligible students could benefit.
Manamela said the NSFAS had given him an undertaking that all students who had yet to receive a response to their applications for funding for 2018 would have an answer by the end of the week.
The NSFAS, which has processed 304,000 applications for financial support for 2018, has been receiving about 8,000 queries a day at its Wynberg call centre. It also fields queries on e-mail and social-media platforms. Manamela said that about 70,000 students were expected to benefit from NSFAS support in 2018, but declined to be drawn on how the government planned to fund Zuma’s promise of free higher education for students from poor and workingclass families. Those details would be provided in the February budget, he said.