NSFAS Under Fire for Paying R200 Million to 4 Service Providers, and for Renting R2 Million Offices

• Some of the expenses by the National Student Financial Aid Scheme (NSFAS) have been questioned by Parliamentarians
• NSFAS was found to have paid over R200 million to four service providers over 17 months, as well as R2 million a month on rent
• Acting Chief Executive Officer, Waseem Carrim, asked for six months to turn the struggling financial aid scheme around

Briefly News journalist Byron Pillay has dedicated a decade to reporting on the South African political landscape, crime, and social issues. He spent 10 years working for the Northern Natal Courier before transitioning to online journalism.

WESTERN CAPE – The National Student Financial Aid Scheme (NSFAS) is back in the headlines for all the wrong reasons.

NSFAS appeared before Parliament’s Portfolio Committee on Higher Education on Wednesday, 7 May 2025, to answer questions about funding, allowances, student appeals and accommodation matters.

Acting Chief Executive Officer, Waseem Carrim, was grilled by members of Parliament who described NSFAS as a disappointing institution.

R200 million paid to 4 service providers

One of the biggest concerns for the committee was the appointment of four service providers who were meant to conduct accreditation of the properties whose owners had applied to be student accommodation.

The committee heard that these service providers were paid more than R200 million over 17 months for their services. They also received a 5% commission from landlords for every transaction related to NSFAS. The committee also heard that service providers sometimes delayed payments, which led to some landlords evicting students as they had not been paid.

The Economic Freedom Fighters’ (EFF) Sihle Lonzi asked why NSFAS needed to use service providers, saying it should be scrapped, but Carrim explained that they were bound to them as the agreement was signed before his time. He added that they instituted a legal review and that the Special Investigating Unit (SIU) also flagged the process for review.

Lonzi argued that there were unnecessary positions created just so others could benefit.

“Comrades want to eat, so they create unnecessary middlemen. We are just making people rich at the expense of students," Lonzi argued.

You can view his comments below.

NSFAS spends R2 million on Cape Town offices

The committee was also surprised to hear that NSFAS spends more than R2 million a month on rent for its offices in Cape Town. Members of Parliament called for the institution to relocate due to the costs, and while Carrim said they are willing to move, they could not do so due to contractual obligations.

He added that the SIU confirmed irregularities in the procurement process of the offices. Carrim asked for six months to turn around the struggling scheme.

While the scheme has faced a lot of criticism over the years, some students have made the most of it. In September 2024, one young lady turned her R1,400 allowance into a thriving business.

In October 2024, a woman bragged that she built a room with the money.

NSFA cuts ties with corrupt service providers

In July 2024, NSFAS cut ties with four service providers due to corruption allegations.

Briefly News reported that NSFAS would no longer use Coinvest, Ezaga, Naracco or Tenet.

The companies used to distribute student allowances, but this is then done by the universities for the rest of 2024.

Source: Briefly News