More than 12,000 South African students risk being locked out of their studies after the National Student Financial Aid Scheme (NSFAS) suspended their funding mid-year, plunging them into financial uncertainty while the entity investigates flagged cases at a rate of just 2,000 at a time.
The disruption, which the South African Union of Students (SAUS) said has hit students at 17 institutions nationwide, comes as Public Protector Advocate Kholeka Gcaleka's own probe laid bare deep-rooted administrative failures at NSFAS, including chronic delays in funding decisions, appeal outcomes and allowance payments that have left students unable to secure accommodation, cover basic needs, or even confirm their registration.
A Section 7(9) notice issued by Gcaleka earlier this week exposed severe administrative weaknesses and inadequate systems at the NSFAS, impairing its ability to fulfil its mandate.
Gcaleka noted that independent reviews, including a 2021 Ministerial Committee of Inquiry, concluded that NSFAS had operated in a “near-permanent state of crisis”, materially compromising students’ dignity, welfare and access to higher education.
SAUS spokesperson Dr Thato Masekoa said the organisation was assisting about 12,000 students whose funding had been suspended while NSFAS conducts what it calls a GAP investigation.
“When we had a meeting with the administrator, we were told that they are investigating each and every one of those students who had been flagged. They can only do 2,000 [at a time], and SAUS has been considering taking NSFAS to court over the disruption of students’ studies,” he said.
“At the beginning of the year, students cannot take another major bursary once they have been accepted by NSFAS. We see this as an injustice. All 12,000 must be reinstated and, if there is a funding problem, students must be told at the beginning of the year.”
Masekoa said the investigation had affected students at Cape Peninsula University of Technology, Sefako Makgatho Health Sciences University, University of Fort Hare, Nelson Mandela University, University of the Free State, University of Limpopo, Stellenbosch, Wits, Durban University of Technology, University of Mpumalanga, University of the Western Cape, University of Venda, Central University of Technology, Vaal University of Technology, Walter Sisulu University, University of Johannesburg and Mangosuthu University of Technology.
Lelethu Dezide, 21, who is studying for a Public Administration degree at the University of Fort Hare, has not had funding since May.
“It’s the only source of money I have. It helped me and my family to cover the basic things that I need,” she said.
Dezide was previously enrolled at Walter Sisulu University and funded by NSFAS in 2024. After transferring to Fort Hare, she was initially not approved for funding in 2025, but was approved again in 2026 after reapplying.
She said she was informed in April that her funding was being investigated.
Dezide, who lives in university residence, has not received her R1,700 monthly living allowance since May.
“It has been a rough year. It is taking a toll on me. I used the money to also help my family. It gets to a point where you are tired and want to give up. It’s really not nice just being told [that you] just want to give up,” she said.
NSFAS spokesperson Ishmael Mnisi had not responded by the time of publication to questions about the funding suspensions.
During his appearance before Parliament’s Standing Committee on Higher Education, former NSFAS administrator Hlengani Mathebula revealed that, in the current financial year, there had been 105,145 appeals. Of these, 21,892 were rejected while a further 21,144 were withdrawn or closed.
Deputy Minister of Higher Education and Training, Yusuf Cassim, told the committee that the underlying cause of students being defunded during the academic year was that NSFAS conducted only a means test for financial eligibility when students were initially funded, without conducting academic verification at that stage.
Meanwhile, Gcaleka said the mid-year defunding has exposed students to severe financial, academic and personal prejudice.
She also found that the backlog in appeals had caused practical prejudice to students who remained unable to secure accommodation, subsistence support or confirmation of registration while their appeals were pending.
“Additionally, the clearing of existing appeal backlogs and the removal of systemic deficiencies contributing to these delays is amongst the terms which were given to the former administrator, which shows that there is acknowledgement on the side of government of these deficiencies,” Gcaleka said.
She said the failure to adjudicate appeals timeously was inconsistent with Section 33 of the Constitution and Section 3(1) of the Promotion of Administrative Justice Act (PAJA), which requires administrative action that materially affects rights or legitimate expectations to meet procedural fairness requirements.
NSFAS is also currently estimated to owe higher education institutions R10.4 billion in outstanding fees.
The Public Protector’s findings come on the heels of a High Court judgment ordering the reinstatement of the NSFAS board, pending an application to set aside the appointment of administrator Hlengani Mathebula.
The scheme has now undergone three separate administrative interventions under Section 17A in the past eight years: in 2018, 2024 and 2026.
An SIU investigation indicated that more than 40,000 students across 76 higher education institutions had been improperly funded, at an estimated cost of R5.1bn.
Professor Linda Meyer, spokesperson for South African Private Higher Education, said NSFAS was effectively transferring the financial, administrative and reputational consequences of its dysfunction to universities.
“Universities are already facing serious cash-flow pressures. Some institutions are reportedly owed more than R1bn in outstanding tuition fees. These are not abstract accounting discrepancies. Universities have already provided teaching, accommodation, infrastructure and student support services despite not receiving income,” she said.
“Institutions with large numbers of NSFAS-funded students are particularly exposed because they cannot easily replace this income from other sources. Universities cannot continue indefinitely as involuntary lenders to the state while simultaneously being expected to maintain academic quality, pay salaries and suppliers, support students and meet their statutory obligations.”
Meyer said universities were also diverting substantial staff time and resources towards tracing payments, correcting NSFAS records, resubmitting data, managing appeals and responding to distressed students.
“University financial aid offices have increasingly become crisis management centres for failures originating outside the institutions themselves. This is an unacceptable displacement of responsibility,” she said.
She said the persistence of these failures demonstrated that NSFAS was not experiencing a temporary administrative difficulty, but rather a deep institutional breakdown compounded by weak oversight from the Department of Higher Education and Training.
“NSFAS has been allowed to assume responsibility for an extraordinarily complex national funding system without developing the governance, technical capacity, information systems and internal controls required to administer it,” Meyer said.
“It determines eligibility, exchanges data with institutions, pays tuition and allowances, manages appeals, accredits accommodation and investigates suspected irregularities. Yet its systems and administrative capabilities remain manifestly unequal to this mandate.”
ntsikelelo.qoyo@nationalmg.co.za