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By Johnathan Paoli
National Student Financial Aid Scheme (NSFAS) administrator Freeman Nomvalo has outlined plans to address the ongoing student accommodation crisis, revealing that the situation is “complicated”.
Many private accommodation providers are unpaid, and thousands of students are in a precarious situation.
Nomvalo reaffirmed NSFAS’s commitment to address the issues swiftly.
“It is less important that there may be details that are incorrect. What matters is that it is a fact that accommodation providers are feeling the pinch of not being paid, and that is the issue we have to address and respond to,” Nomvalo told the SABC.
Accommodation providers have been vocal about the financial strain caused by unpaid rental fees from the scheme, with some warning of potential evictions if payments are not made soon.
Nomvalo acknowledged their concerns, stating that NSFAS was actively working to resolve the issue.
“Within this week, we are going to reach out to the landlords. The time required to resolve their issues depends on the complexities involved, but we are committed to resolving this speedily,” he said.
The financial challenges facing accommodation providers stem from delays and inefficiencies in the flow of funds, with the administrator identifying three broad issues contributing to the crisis.
Historically, the scheme disbursed funds directly to students for accommodation, but not all students transferred the money to landlords. This led to significant arrears, particularly for payments made before NSFAS transitioned to a new pilot model.
It piloted a new payment system to streamline transactions directly to landlords, but the rollout has not yet included all providers.
Consequently, some landlords are still outside the system, and their payments depend on funds being routed through students, exacerbating delays.
The data NSFAS currently possesses for processing payments to some landlords needs to be verified before any disbursements can occur.
Nomvalo claimed that this verification process has further slowed the resolution of claims.
While the payment delays date back to March last year, the issue was only escalated to the appropriate structures in December.
According to Nomvalo, the scheme has since taken steps to resolve the problem, including interactions with stakeholders and implementing interim solutions.
However, these measures have not met the expectations of landlords.
“A solution was put in place, but it did not deliver as expected. We need to find a better mechanism, one that prevents students from being tempted to misuse funds meant for landlords and ensures payments are handled efficiently,” he explained.
Nomvalo emphasised the importance of verifying claims to ensure that only legitimate amounts were paid.
He said the scheme has established a task team to engage directly with landlords and student leaders to address the crisis.
To expedite a resolution, Nomvalo called on all parties, including students, landlords and other stakeholders, to provide additional information to address gaps in the system.
On the high number of Bachelor passes achieved by the Class of 2024, he said the scheme was ready to accommodate university students.
“The total amount of applications is around 200,000 applications, for which the scheme has sufficient funds, however, should the amount exceed projections, the scheme would approach the National Treasury for additional funds,” the administrator said.
While Nomvalo acknowledged these hurdles, he expressed optimism about finding sustainable solutions that prevent future crises.
It has been reported that 7000 students across the country face potential evictions from their private accommodations due to unpaid rental fees.
Private Student Housing Association CEO Kagisho Mamabolo expressed concern over the sustainability of private accommodation providers, saying in a statement that the scheme’s failure to pay its dues threatened the stability of the entire sector.
“These are students who are residing in our residents across the country, and I have no doubt that there could be more students affected, especially in the areas where the accommodation providers are not members of the PSHA. So, the number could be significantly higher,” Mamabolo said.
The association, which represents accommodation providers housing more than 80,000 students, previously issued an ultimatum to NSFAS to settle its outstanding debt of R44 million within 14 days or risk a significant disruption of the 2025 academic year.
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