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A lifeline with challenges: Experts discuss funding, disparities, and the future of NSFAS

A lifeline with challenges: Experts discuss funding, disparities, and the future of NSFAS
Students protest at George Tabor Campus in Dube on March 07, 2024 in Soweto, South Africa. The students are demanding an equal opportunity when it comes to applying for accommodation and for NSFAS funding amongst other demands. (Photo: Gallo Images / Fani Mahuntsi)
Lerato Mutsila
By Lerato Mutsila
28 Feb 2025
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In a recent webinar hosted by Daily Maverick, experts dissected the complexities and challenges surrounding the National Student Financial Aid Scheme (NSFAS), a critical entity in South Africa’s post-school education landscape. The conversation centred on NSFAS’ effectiveness, administrative hurdles, and its role in fostering equitable access to higher education.

The 2025 academic year is in full swing for higher education students, and as has happened in countless years before the beginning of the academic year has been fraught students sleeping out in the cold and student protests at universities and colleges as South Africa’s National Student Financial Aid Scheme (NSFAS) buckled under the pressure of unpaid rental fees, delayed funding decisions and a mounting accommodation crisis which Daily Maverick education journalist Takudzwa Pongweni wrote “threaten to disrupt students’ access to higher education”.

Year in, year out students are faced with the same issues with NSFAS, which is why on Wednesday, Pongweni hosted a Daily Maverick live journalist webinar, featuring Khaya Sithole, a chartered accountant, academic, and commentator, and Leslie Powell, an associate professor specialising in vocational education and training at the University of Cape Town (UCT) to uncover what exactly is going on at the national bursary fund.

Kicking off the webinar, Pongweni said that while NSFAS had been established to distribute funds to students who could not afford post-school education at public universities and Technical Vocational Education and Training (TVET) institutions, the scheme had fallen far below muster.

“Over the last couple of years NSFAS has made headlines for all the wrong reasons, including delayed payment, allegations of corruption and concerns about mismanagement," Pongweni said.

https://www.youtube.com/watch?v=svWrdfVih2c&ab_channel=DailyMaverick

A Lifeline with Challenges


Providing a breakdown of NSFAS’s operational structure and eligibility criteria, Sithole said the national bursary primarily funded three categories of students.

He explained that NSFAS primarily targeted students from families with an annual income below R350,000, deeming them “unlikely to be able to afford their own way in education”. Additionally, NSFAS supported students with disabilities, with a higher income ceiling of R600,000, and offered loans to students with incomes between R350,000 and R600,000.

According to Sithole, NSFAS boasted a budget of “just over R50-billion”. In the previous year, the scheme funded approximately 798,000 students, with a significant portion (about 565,000) attending universities and the remainder enrolled in TVET colleges. 

Sithole emphasised the scheme’s vital role in enabling access to higher education for numerous students, but highlighted how NSFAS was plagued by administrative challenges that primarily stemmed from the right model to operate the institution.

Sithole noted that in the past, NSFAS had dedicated financial aid officers at each institution, granting greater on-site discretion in assessing eligibility and processing payments, which also meant a greater turnover time in granting applications and allocating funds. However, Sithole added that a sinister trend had emerged where these representatives could be bribed and students could pay their way on to the NSFAS list, and that concerns about the integrity of these processes led to a shift towards centralisation.

While centralisation aimed to curb corruption, it introduced new challenges, such as delays in response times and payment processing, often leaving students without an immediate course for recourse.

The inverted pyramid


Describing South Africa’s post-school sector as an inverted pyramid, Powell said while the higher education sector should have a base (the largest part of the pyramid) of intermediate skills and TVET colleges at the bottom and higher-level skills universities at the top, the inverse was true in South Africa where universities enrolled the majority of students and TVET colleges the least.

Powell highlighted that beyond the fact that TVETs were often overlooked by students, there were significant disparities in funding between university and TVET students that further reinforced the inverted pyramid.

Powell highlighted the stark contrast in allowances, stating that in 2024, university students received approximately R16,500 per year as a living stipend, including allowances of R3,000 for personal care and R13,000 for meals. In contrast, TVET college students received about R10,000 per year, a figure Powell deemed “significantly lower than university students”.

students nsfas backlog Disgruntled students march to the National Student Financial Aid Scheme’s head office in Cape Town on 24 May 2023. (Photo: Gallo Images / Brenton Geach)



Citing data from 2016 to 2020, Powell revealed that R94-billion was spent on university students compared with just over R16-billion on TVET college students. In 2021, NSFAS allocated five times more funding to university students than their TVET college counterparts.

Powell shared a poignant anecdote about students living in the same accommodation, with TVET college students experiencing “significantly poorer” living conditions due to the lower living stipend.

“So the sensible financial choice for an impoverished student would be to go to a university because the living stipend is so much more... it gives you a sense of the discrepancy and the way in which NSFAS is in fact pushing the sector and this inverted pyramid in a very strange way and incentivising a post-school sector that doesn’t really make sense for our country,” Powell said.

The human cost: poverty and vulnerability


Powell’s research delved into the lived experiences of TVET college students, revealing the profound impact of inadequate funding. She referenced a study on NSFAS and student experiences in TVET colleges, which employed the concept of “multidimensional poverty”, encompassing economic factors, health, and overall wellbeing.

The study uncovered that while NSFAS broadened and expanded access to education in the TVET college sector, several of the poorer students’ families were driven into debt while awaiting NSFAS approval, or because of nonpayment, with students turning to loan sharks to bridge the financial gap. Shockingly, the research indicated that some students were pushed into “transactional sexual relationships” and the informal economy to survive.

Powell emphasised the detrimental effect on students’ mental health, echoing concerns observed among university students. She questioned whether NSFAS was the most effective tool for poverty intervention, advocating for a reevaluation of the TVET college sector and a renewed focus on initiatives like the youth fund.

The student accommodation crisis


Sithole described a “massive deficit” between the teaching capacity and accommodation capacity within public institutions. He said that the shortage of on-campus housing had led to a reliance on private accommodation providers, however, the lack of uniform standards and oversight across institutions created challenges. 

Students protest at George Tabor Campus in Dube on 7 March 2024 in Soweto, South Africa. The students were demanding an equal opportunity in applying for accommodation and for NSFAS funding. (Photo: Gallo Images / Fani Mahuntsi)



Some universities did not view private accommodation as part of their responsibility, leaving students to navigate the market independently. Other institutions attempted to accredit and oversee these providers, to ensure student safety and wellbeing. Despite some institution’s efforts, a reliance on private accommodation providers had grown, prompting NSFAS to pay closer attention to student housing situations. 

Sithole added that a central challenge was determining appropriate payment levels for these diverse private accommodation options. This patchwork approach resulted in inconsistent living conditions and the potential exploitation of students.

 A call for reform


The webinar underscored the critical need for reform within NSFAS to ensure its effectiveness in promoting equitable access to higher education. Key areas for improvement included:

  • Addressing the funding disparities between university and TVET college students to create a more balanced post-school sector.

  • Reevaluating the adequacy of allowances for TVET college students to alleviate poverty and vulnerability.

  • Streamlining administrative processes to minimise delays and ensure timely payments.

  • Exploring alternative funding models and initiatives to complement NSFAS’ efforts.


By addressing these challenges, NSFAS could better fulfil its mandate of empowering young people with the skills and education needed to thrive in South Africa’s economy. DM

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