NSFAS Faces Intense Scrutiny Over R200 Million Payments and Office Spending
The National Student Financial Aid Scheme (NSFAS) is once again under fire after appearing before Parliament’s Portfolio Committee on Higher Education on Wednesday, 7 May 2025. The institution faced tough questioning regarding its handling of student funding, allowances, appeals, and accommodation.
Acting CEO Waseem Carrim appeared before the committee, where MPs expressed frustration with the scheme’s performance, describing NSFAS as a consistently disappointing entity.
A major point of concern was the involvement of four service providers hired to accredit properties for student accommodation. These companies reportedly received over R200 million over a 17-month period and were also entitled to a 5% commission from landlords for each NSFAS-related transaction. Parliament heard that these providers sometimes delayed payments to landlords, which in some cases resulted in students being evicted due to unpaid rent.
The Economic Freedom Fighters’ (EFF) Sihle Lonzi questioned the need for outsourcing this service, suggesting it be abolished altogether. In response, Carrim clarified that the contracts were signed before his tenure and are currently under legal review. The Special Investigating Unit (SIU) has also flagged the matter for further scrutiny. Lonzi added that some positions appeared to be created solely for financial gain.
Another issue raised was NSFAS’s monthly expenditure of over R2 million on office space in Cape Town. Parliamentarians urged the scheme to relocate to a more affordable location. While Carrim confirmed their willingness to move, he cited contractual obligations as a barrier. He also revealed that the SIU had identified procurement irregularities related to the office lease.
Carrim appealed to Parliament for six months to implement a turnaround strategy and stabilise the institution.
Despite the ongoing criticism, some students have managed to use their NSFAS allowances creatively. In September 2024, a student reportedly used her R1,400 monthly allowance to launch a successful business, while another individual claimed in October to have built a room using her funds.
In a move to address corruption concerns, NSFAS cut ties with four companies in July 2024. Coinvest, Ezaga, Naracco and Tenet, which were previously responsible for disbursing student allowances, were removed from their roles. Since then, universities have taken over the responsibility of distributing allowances for the remainder of 2024.