Cosatu Calls For Government Intervention Amid NSFAS Payment Crisis

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Over the past few weeks, the new NSFAS direct payment system has received backlash from students and stakeholders alike. Issues around payments have now reached trade unions as there have been calls for government intervention.

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Trade union federation Cosatu has called on the government to intervene in the National Student Financial Aid Scheme (NSFAS) direct payment system tension.

The union issued a statement seeking immediate interventions by the Department of Higher Education and Training, National Treasury, and the Financial Sector Conduct Authority.

There is no excuse in a 21st century economy for this level of chaos to be allowed to continue. The Department of Higher Education and National Treasury need to intervene and put in place a payment system that will ensure students, universities and colleges receive their payments timeously and without scandalous deductions by private companies profiteering at the expense of the poor.

Direct Payment System Issues

Cosatu’s statement follows weeks of student unrest and protest over challenges with the direct payment system as students have claimed that the system is problematic.

NSFAS partnered with four banking service providers to bring the new payment solution to students. These service providers include Tenet Technology, Coinvest Africa, Ezaga Holdings and Norraco Corporation.

However, since its implementation there have already been a number of complaints about the system, including students not receiving their funds, exorbitant bank charges, glitches, and unauthorised access resulting in loss of funds. 

In addition, some students have already expressed frustration noting that the onboarding process has been everything but ‘seamless’, with some questioning communication around the new system and why it was introduced at universities in the middle of the academic year.

Cosatu spokesperson Matthew Parks says these concerns paint a picture of endless chaos at NSFAS adding that such kind of chaos cannot continue. 

He adds, “NSFAS has long been infamous for delays in payments reaching students and the universities and colleges who depend upon it. Many students have been wrongly defunded by NSFAS and then have had to wait from 6 months to years for their cases to be resolved.”

NSFAS Media Briefing

During a media briefing on Monday, NSFAS dismissed claims that it implemented the new payment system without proper consultation.

NSFAS Board Chairperson, Ernest Khosa said they are concerned about the notion that they implemented the new direct allowance payment system without proper engagement with stakeholders.

According to Khosa the system was introduced following several consultations and aiming to make the payment of allowances easier and to prevent payment delays.

Most of these initiatives were a response to the call by sector stakeholders, especially students themselves who cited the scattered processors as the source of frustration these students were being sent from pillar to post whilst looking for answers regarding the status of their application.

Khosa says that some of the onboarding issues students have been experiencing are mainly due to teething problems and  students having to complete the authentication processes.

NSFAS called on students to complete the authentication processes to ensure they can receive their allowances. Failure to complete the authentication process could result in delays of NSFAS allowance payments.  

They added that teams have been deployed to campuses around the country to assist students with authentication processes. 

SAUS Responds To NSFAS Briefing

South African Union of Students (SAUS) spokesperson Asive Dlanjwa acknowledged that consultations with stakeholders regarding the payment systems were held. However, there are several concessions that were not implemented. 

Dlanjwa says that NSFAS failed to mention that some of the concessions that were made during engagements particularly between the students and NSFAS were not met. He adds, “This is why we find ourselves in the crisis.”

After months of engagements around bank charges, we had agreed that that it will be no more than R12, and now students have been paying more than R100 on bank charges and that is not what we had agreed on.

Dlanjwa says the banking system has also not been user-friendly, despite NSFAS claiming that the system was easy to use and navigate.

Meanwhile, the government bursary scheme has stated that they are actively working to resolve any remaining barriers that hinder the disbursement of allowances to students.

NSFAS affirmed that they will continue to collaborate and work with universities and TVET college officials, as well as student bodies, to enhance the academic experience of students. 


Suggested Article:

nsfas briefing

More than one million students are currently receiving comprehensive bursaries from the National Student Financial Aid Scheme. However, several challenges are preventing students from accessing their bursaries. 

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