The National Student Financial Aid Scheme (NSFAS) has begun a comprehensive effort to locate and reimburse approximately 19,536 former beneficiaries who overpaid on historical student loans, with total refunds amounting to roughly R77 million. The initiative targets individuals with loan accounts originating before 2010.
NSFAS Spokesperson Ishmael Mnisi confirmed the tracing campaign, noting that the scheme conducted a thorough review of its legacy loan book, factoring in historical interest rates to identify accounts where repayments exceeded outstanding balances.
“We made a conscious decision to repay those who overpaid,” Mnisi stated. “Beneficiaries also have the option to leave the funds with NSFAS to support current students if they choose.”
The extended timeframe before identifying these overpayments relates to NSFAS’s structural shift in late 2018, when it transitioned from a loan-based model to a bursary system. Mnisi explained that implementing the new bursary framework required significant system adjustments, which temporarily diverted attention from legacy loan administration. “During that period, the loan management system experienced challenges, and recoveries and tracing were not prioritised,” he said. NSFAS has since restored its loan management infrastructure and committed to reviewing records from 2010 onward.
The current initiative runs parallel to ongoing debt recovery efforts for outstanding loans. As part of a pilot phase, NSFAS has already reached approximately 500 beneficiaries, allowing a 21-day window per batch to complete verification and initiate disbursements. Mnisi described the response as overwhelmingly positive, with many recipients unaware they had fully settled their obligations or were entitled to refunds.
Refund values vary considerably, with some beneficiaries owed less than R10,000 while others may receive approximately R15,000 or more. All repayments will be issued tax-free, with NSFAS managing any interest-related adjustments internally.
To locate beneficiaries, NSFAS is collaborating with specialised tracing agencies and leveraging ID numbers to update contact information through partnerships with the Department of Home Affairs and SARS. Of the 19,536 identified individuals, roughly 13,000 have been successfully traced to date. In cases where beneficiaries are deceased, funds will be held by the National Credit Regulator until legitimate heirs are identified.
A robust verification framework has been established to safeguard against fraud. Beneficiaries will receive official NSFAS forms requiring certified identity documentation. Submitted details are cross-referenced with SARS, Home Affairs, and financial institutions to confirm identity and bank account ownership. “We link the identity to the bank account belonging to that same person,” Mnisi explained, emphasising the multi-layered authentication process.
For beneficiaries who have changed surnames due to marriage or other reasons, verification protocols account for these updates through Home Affairs records. Those residing outside South Africa are encouraged to provide local banking details to facilitate smoother, cost-effective disbursements in South African currency, though international transfer options remain under review.
Mnisi issued a clear warning regarding potential scams: NSFAS representatives will never contact individuals by phone to request banking information. All legitimate communication will originate from verified NSFAS channels, including the dedicated email address [email protected]. Beneficiaries uncertain about any contact are advised to verify through official NSFAS platforms before sharing personal information.
While processing all 19,536 cases may extend up to a year, Mnisi indicated NSFAS is scaling operational capacity to accelerate disbursements. “We recognise these beneficiaries have waited a long time,” he said. “Our goal is to confirm eligibility efficiently and release funds as swiftly as verification allows.”