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The NSFAS Direct Payment System Is Being Sued By ActionSa



The NSFAS Direct Payment System Is Being Sued By ActionSa

ActionSA Takes NSFAS Direct Payment System to Court

The NSFAS Direct Payment System Is Being Sued By ActionSa. ActionSA, a political party, is determined to challenge the decision to outsource the disbursement of National Student Financial Aid Scheme (NSFAS) student allowances through ill-equipped service providers. The party plans to take the matter to the high court, seeking a declaration that the decision is irrational and requesting the contract award to be set aside.

Prioritizing Taxpayers and Students

ActionSA’s legal director, Alistair Shaw, emphasized that their objective is to protect the best interests of taxpayers and students. They aim to prevent the exploitation of NSFAS by unscrupulous tenderpreneurs who prioritize personal gain over the welfare of students.

Concerns Driving the Legal Challenge

The party has identified two key concerns that drive their legal bid. Firstly, they seek to challenge the questionable nature of the contract and address the financial burden placed on students due to excessive fee structures associated with the “NSFAS bank accounts” provided by inexperienced service providers.

Matthew George, the chairperson of ActionSA Western Cape students forum, highlighted that these service providers charge significantly higher transaction fees compared to the major commercial banks, which were unsuccessful bidders. The additional fees exacerbate the financial strain faced by students.

Secondly, ActionSA criticizes the lack of thorough consultations conducted by NSFAS prior to the migration to the new system. The party argues that this rushed and flawed process has resulted in confusion among students and university administrators. They claim that the last-minute information sessions provided by NSFAS failed to address basic questions and concerns.


Implementation Challenges and Student Hardships

George also pointed out various issues with the onboarding and registration process, including difficulties in updating contact details, failures to receive one-time passwords for account registration, site crashes, and rejections of identity documentation. These challenges have caused delays in disbursing student allowances, resulting in inconvenience and hardship for those relying on timely access to their funds.

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Capacity Concerns and Pragmatic Action

ActionSA believes that NSFAS and the appointed companies lack the capacity to effectively implement the migration to the new system. In response to these pressing issues, the party emphasizes the need for a more pragmatic, proactive, and sustainable approach. They seek to address the root causes of problems and hold accountable those responsible for compromising the interests of students and young people.


ActionSA’s decision to take the NSFAS direct payment system to court reflects their commitment to safeguarding the interests of students and taxpayers. By challenging the outsourcing decision and highlighting implementation challenges, they aim to address financial burdens and promote accountability. Their proactive approach seeks to bring about positive and sustainable change in the education system.

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