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Owing money to NSFAS: How is this collected?

By Jessica Anne Wood

A recent report stated that a large portion of the money owed to the National Student Financial Aid Scheme (NSFAS) is from people working in government. According to Kagisho Mamabolo, NSFAS spokesperson, “At the end of March 2015, the Scheme recorded an audited loan book with a cumulative nominal value of R21.2 billion and a fair value of R6.2 billion.”

The NSFAS website highlighted: “It takes ten repaying beneficiaries to fund one student.” This means that the more people who repay their debts to NSFAS, the more students can be helped with funding.

In October 2015, Sizwe Nxasana was appointed as board chairperson of NSFAS by Minister of Higher Education and Training, Dr Blaze Nzimande. Following this, plans to recover all outstanding debt from debtors who are eligible to repay their debts to NSFAS were announced.

Who owes the money?

Mamabolo pointed out that debtors are employed in both the private and government sectors. There are 109, 284 debtors in the private sector, with 81, 000 employed by the government. Of these government employees, Mamabolo revealed that some of them are high ranking government officers, while “the greater number is of lower level employees.”

Debt collection

Mamabolo explained: “NSFAS is a registered credit provider and in line with legislation follows the normal debt recovery processes which may lead to action taken against those who fail to repay loans even though they can afford to do so. Beneficiaries of the scheme are obligated, according to contractual agreements and the NSFAS Act 56 of 1999, as amended, to make repayments as soon as they are employed and earning an income of R30 000 per annum and more. Repayments of NSFAS loans can go a long way to assist students who need financial support to further their studies at public higher education institutions.”

In addition, Mamabolo revealed that NSFAS also partners and collaborates with professional debt collection companies and other public entities to track debtors who are earning a salary, but not repaying their NSFAS loans, as well as debtors who have defaulted on their payments.

“Internally, NSFAS has a dedicated team focusing on improving the rate of recoveries in collaboration with the NSFAS Contact Centre. These strategies have showed positive results. We have recorded an increase in number of debtors who are making repayments and many more are in the process of making repayment arrangements,” added Mamabolo.

According to Mamabolo, NSFAS has tracked a significant number of students who owed money to the scheme. Following the launch of the recoveries campaign in October last year, Mamabolo noted that they are encouraged by the number of debtors who are making repayments.

“We have already recovered more than R19 million from more than 19,070 debtors who previously were not repaying their loans since gaining employment,” emphasised Mamabolo.

With regards to the recovery programme launched last year, Mamabolo noted that a majority of the debtors who have started making payments are government employees.

“Repayments received from our debtors contribute to a pool of funds that is allocated to eligible students from poor and disadvantaged background at Universities and TVET Colleges on a yearly basis,” said Mamabolo.

Repaying your debt

NSFAS repayment terms are affordable to accommodate the majority of our debtors who come from low income households. Interest is only charged 12 months after a student has completed studies by either graduating or dropping out. In addition to these terms, repayments are based on the salary that is earned and start once a salary is R30 000 or more per year. This means that a debtor would start payment at three percent of the annual salary, increasing to eight percent or more when a salary reaches R59, 300 or more per year. For example, a beneficiary will pay back R900 a year on a salary of R30, 000 a year, or R84 per month.”

Applying for additional funding

If you have outstanding debt with NSFAS, can you apply for additional funding through the scheme? When asked this question, Mamabolo responded: “It is first important to note that NSFAS mainly provides funding for first undergraduate qualification of a qualifying student, and may also provide funding for a post graduate qualification to an eligible student if it is a requirement for the student to perform his work.”

He added: “NSFAS would like to appeal to all debtors to do what is right and repay their NSFAS loans. Repayments received from our debtors contribute to a pool of funds that is allocated to eligible students from poor and disadvantaged background at Universities and TVET Colleges on a yearly basis. All debtors who wish to initiate repayments may contact NSFAS Contact Centre on 086 00 67 327 or email”

  If you are in need of a study loan, you can apply for one through Justmoney, click here.

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