The National Student Financial Aid Scheme (NSFAS) has launched a major tracing initiative to return approximately R77 million in accumulated overpayments to former beneficiaries. The scheme has identified 19,536 former debtors, primarily individuals with historical loan accounts dating back to before 2010.
NSFAS Spokesperson Ishmael Mnisi confirmed the initiative, explaining that the organisation traced through its loan book to identify individuals who had overpaid or fully settled their loans. After reviewing historical interest rates, NSFAS determined that these beneficiaries were owed refunds.
“We made a conscious decision to pay back those loans for those that have overpaid,” Mnisi said. “We are also giving them an option: those who don’t want that money back can retain it with NSFAS so that it can be used to fund other students.”
The delay in identifying these overpayments stems from NSFAS’s transition from a loan scheme to a bursary system in 2018. Mnisi acknowledged that during this period, focus shifted to implementing the new bursary scheme, which impacted the loan management system. “In that process, the loan management system suffered, and less focus was paid on the loan book,” he explained. NSFAS has since committed to restoring its loan management capabilities and reviewing records from 2010 to date.
The initiative operates on a two-pronged approach: tracing overpayments while continuing recovery efforts for outstanding loans. NSFAS has already contacted approximately 500 beneficiaries as part of a pilot phase, allowing 21 days to verify and process each batch. Mnisi reported that responses have been positive, with many recipients expressing relief and surprise that they were owed refunds.
Refund amounts vary, ranging from under R10,000 to approximately R15,000 and higher. Mnisi emphasised that all refunds will be tax-free, with NSFAS absorbing any interest-related calculations.
To locate beneficiaries, NSFAS is working with tracing agents and using ID numbers to access updated contact details through partnerships with Home Affairs and SARS. Of the 19,536 identified individuals, approximately 13,000 have been successfully traced. For cases where beneficiaries are deceased, funds will be held by the National Credit Regulator until rightful heirs are identified.
Mnisi outlined a stringent verification process to prevent fraud. Beneficiaries will receive official forms requiring identity documentation, with details cross-referenced against SARS, Home Affairs, and banking institutions. “We expect that if Ishmael is to receive the money, Ishmael must give us his identity, and we link it to a bank account that belongs to Ishmael,” he said.
For beneficiaries who have changed surnames or relocated abroad, NSFAS will conduct additional verification through Home Affairs systems. While international transfers are possible, Mnisi encouraged those living overseas to provide South African banking details to streamline the process and avoid additional charges.
To protect beneficiaries from scams, Mnisi warned that NSFAS agents will never call to request banking details. All official communication will come through verified channels, including a dedicated email address: refund@nsfas.org.za. Beneficiaries unsure of a contact’s legitimacy are urged to reach out through official NSFAS platforms.
Mnisi indicated that while processing all 19,536 cases may take up to a year, NSFAS aims to expedite the process by augmenting capacity. “We want to fast-track these processes because it has indeed been a long time that the beneficiaries would have been waiting for this money,” he said.
