NSFAS: Debt Cancelled


Last month, the Department of Higher Education and Training announced that R967m had been set aside to alleviate the debts of over 52 000 students. This may sound unbelievable but it’s true.

Students studying with the assistance of loans from NSFAS, the National Student Financial Aid Scheme are eligible to be on the receiving end of the Department’s generosity.

Naledi Pandor, Minister of Higher Education and Training, made the announcement:

“This is a significant contribution which will alleviate some of the debt owed to universities by students and is confirmation that government is sensitive to the plight of students from poor and working-class families.”

It wasn’t immediately clear who would qualify, how many students would be affected or what the process would be. Here’s an update of everything we know so far.

Why is Money only now Available?

While most of us are aware of NSFAS (the government student bursary and loan scheme), you may not remember that last year the scheme changed – in a big way.

Before 2018, students with a family income of less than R122 000 a year were required to fund part of their university costs themselves. The amount provided by NSFAS, under this system, was capped and often insufficient to pay for the total cost of students’ fees and the additional cost of studying.

Many of these students (who were supposed to have their education supported by the government’s loan and bursary scheme) ended up going into debt with their universities. And tens of thousands of those students missed out on then-President Jacob Zuma’s free education funding scheme announcement in 2018. Under this new scheme, students whose combined annual household income is less than R350 000 a year qualified for free education.


Be Informed: The Impact of Free Education

There has been much talk around the topic of fee-free education. Is this for real? How exactly does the government plan to fund the scheme? If you’re a parent or teacher, how will this affect your wallet? 

The students who missed out on this announcement (and went into debt while partly funding their own studies before 2018) are the ones the new R967m allocated to NSFAS by the Department of Higher Education and Training is designed to assist.

Okay, so who Actually Qualifies for the Funding?

The Department of Higher Education and Training recently clarified who would qualify for the funding allocated to settle ‘historic debt’.

According to the department’s director-general Gwebinkundla Qonde,

“the students who are eligible are those who are in the system, who are continuing, who registered in 2017 and 2018 at the cap of R122 000 and as a result because the amount of money was not adequate to pay for the full cost of study.”

What does this mean? Well, you qualify for this funding if you meet the following criteria:

  • The joint income of both your parents, on an annual basis, is R122 000 or less.
  • You entered a programme of study within the last 18 months.
  • You’ve met the academic criteria within minimum time, plus two years.

What Happens next?

NSFAS immediately responded to the announcement, highlighting the value of the contribution and the work already done to determine which students would be affected.

NSFAS is very pleased to be able to assist with the implementation thereof,” said NSFAS administrator Randall Carolissen. “It should be noted that the funds will eventually flow and NSFAS has already started working hard with institutions to identify those students.”

Minister of Higher Education and Training, Naledi Pandor, has confirmed that phase one of the assessment of the historical debt owed to universities has been completed, which allowed the department to determine the number of students who qualified to receive support from this allotment, as well as the figure that would be required to address the gap between those on the new NSFAS scheme and those who missed out.

“We have now concluded the first phase of the due diligence and found that 52 514 NSFAS-qualifying students who were registered for the 2018 academic year owed universities R967m.”

By the 2022 academic year, it is anticipated that all students funded through the old scheme would have exited the higher education system. This boost to NSFAS, then, is a once- off effort to include all South African students in the benefits of last year’s changes to the NSFAS loan and bursary scheme.

The R967m funding is specifically for students who were not included in the new NSFAS scheme, so no one currently making use of the new and improved system will qualify for this funding.

According to Lunga Ngqengelele, spokesperson for the Department of Higher Education, this figure was based on university information of the number of students that have historic debt and are continued students from 2018, suggesting that the R967m figure is intended to settle the full cost of the historic debt of all students currently studying at university. This, however, is yet to be confirmed.


Is Free Education for Everyone?

So the government has committed to a policy of fee-free education. The question on everyone’s lips is whether this will put an end to the missing middle’s fight for funding.

By settling the debts of poor students (who were expected to pay for the gap between their university costs and what their NSFAS loans and bursaries provided), these students will get the same chance as every other qualifying South African to pursue higher education regardless of their financial situation.

EduConnect 2Cents

If you fall in this bracket, it is a great chance for you to complete your studies without having to worry about getting yourself into debt. Be sure to take advantage of this opportunity and find funding 🙂

Related Articles