Concerns have been expressed over the National Financial Aid Scheme’s (NSFAS) capacity to administer the new “missing middle” student loan, which it has now given students the green light to apply for.
NSFAS spokesperson Ishmael Mnisi said on Tuesday: “All the students who want to apply for the loan scheme can do so. They will be separated from those of the bursary. This means the financial aid eligibility criteria will be immediately used to determine if they do qualify for the loan. Guidelines have been approved by the board.”
He was responding to questions during the higher education academic year readiness briefing led by Minister Blade Nzimande.
News of this funding model first surfaced last year and last week Nzimande expressed the department’s readiness to implement the first phase, however, no dates were given regarding the application process, nor was it explained how it would work.
He said R3.8 billion has been set aside for the 2024 academic year to support the loan scheme.
The missing middle students are students who are not eligible for NSFAS funding under the current model, which restricts funding to households earning less than R350 000 a year.
The first phase is expected to fund 47%, or 31 884 of the estimated 68 446 missing middle students.
“This category of students are those who come from families who have a total income of more than R350 000, but not more than R600 000 per annum. NSFAS is currently developing the loan scheme eligibility criteria and conditions for funding to ensure that the scheme is implemented.
This loan scheme will be administered by NSFAS, which has the legal mandate to offer student loans,” said Nzimande.
He said students must apply using the entity’s current application process and ensure they sign the consent form to enable financial verification.
“All students rejected for financial eligibility will be re-assessed and reviewed for the missing middle loan. NSFAS is currently developing guidelines of the loan scheme and they will be communicated to the public in a week’s time,” he added.
The loan scheme will fund both undergraduate and postgraduate students with 70% of these being students in the science, technology, engineering and maths (Stem) programmes, and may be adjusted to include commercial programmes that are in demand in the labour market or entrepreneurial programmes.
Universities South Africa (Usaf) CEO Dr Phethiwe Matutu said for as long universities have not received the full details from NSFAS and the department on how to deal with students that are to get the loan, the status quo will remain.
“It will be ideal that universities get details ahead of the start of the academic year because also not all of the missing middle students will be funded at the same time. While we are not sure how NSFAS will administer this, there is a worry that the entity could be overwhelmed if it does everything by itself. I think that will be too much,” said Matutu.
Cape Times