The Economic Freedom Fighters Students' Command (EFFSC) welcomed the retraction from the National Student Financial Aid Scheme (NSFAS) on the continuation of the direct allowance payment system.
NSFAS provides comprehensive bursaries to more than one million students currently enrolled at public universities and Technical and Vocational Education and Training (TVET) Colleges in South Africa. As part of the NSFAS funding package, students receive allowances to cover expenses they may accrue while strong.
As of 2023, university NSFAS-funded students (with the exception of disabled students) began receiving their allowances via the direct allowance payment system. The system was facilitated by four service providers, namely, eZaga, Coinvest, Norocco and Tenetech.
However, the direct payment systems’ implantation was marred by delayed allowance payments, incorrect allowance, and in some cases, no payments at all which left many financially vulnerable students struggling to make ends meet.
An investigation conducted by Werkmans Attorneys and Advocate Tembeka Ngcukaitobi revealed irregularities in the appointment of the aforementioned service providers. Suspended NSFAS CEO Andile Nongogo, was found to have conflicting interests with these companies, raising serious ethical concerns.
EFFSC President Sihle Lonzi warned the Minister of Higher Education and Training that if the companies continued to oversee allowance distributions, disruptions in higher education institutions would continue.
Last week, acting CEO Masile Ramorwesi confirmed that the fintech companies – Tenet Technology, eZaga Holdings, Noracco Corporation, and Coinvest Africa – will continue paying NSFAS allowances to students in 2024.
Ramorwesi explained that the termination of service provider contracts is a commitment the board is still pursuing, but could not provide a timeframe due to the legal process involved. The board has sought legal counsel on the matter and until termination is officially carried out, the current service providers will continue disbursing funds to students as per their contracts.
However, Ramorwesi explained that NSFAS could not specify when contracts with these companies would be terminated.
The EFFSC said this was a victory for South African students. They emphasised their commitment to ensuring the swift resolution of this matter and pledged to mobilise against any further delays in addressing corruption within the NSFAS Direct Payment Scheme.
