The portfolio committee on higher education has given service providers disbursing allowances to students seven days to submit a comprehensive report on payments they made.
Some MPs were clearly not impressed with the level of detail in the presentations that were made to the committee on Wednesday.
The service providers — eZaga Holdings, Tenet Technology, Coinvest Africa and Norraco Corporation — were briefing parliament on the disbursement of allowances to students, the problems experienced and the plans to address them.
Ryan Passmore, CEO of Tenet Technology, said they were responsible for the payment of allowances to 225,000 students per year.
However, their banking platform on-boarded only 181,054 students, and of these, only 144,396 have been paid their allowances.
A total of 36,658 of the 181,054 on-boarded students still had to undergo an authentication process before they could receive payment.
While all students were charged a R12 monthly transaction fee, which excluded other bank charges, Passmore proposed a R29 fee bundle with “several free transactions”.
“We are committed to finding the best fee model. We are not saying the current one is here to stay.”
eZaga group CEO, Saud Ally, said 98% of the 115,466 students it was responsible for paying, had been authenticated.
Neal MacIntyre from Norraco Corporation confirmed 97% of their students had been authenticated.
Thami Mazibuko from Coinvest Africa said one of the problems they faced was that some students who had been on-boarded had not received their allowances.
“We experienced that a lot quite recently. It’s a big challenge which we are trying our best to resolve with Nsfas to understand when those students are going to be paid.”
Mazibuko admitted that one of the challenges was complaints about the high fees being charged on the students’ accounts.
“We are engaging with Nsfas for a solution that will be suitable for the student market.”
How in the world that was awarded is beyond me. My question to all the service providers is how much are you actually charging students and how much are you making from this?
— ANC MP, Brandon Pillay
DA MP Karabo Khakhau said they had given a whole month not only to Nsfas but to the service providers “to give us confidence, but I am still struggling to understand where this confidence is supposed to come from”.
“On Nsfas’ end, it was a whole wishy-washy rhetoric. From the partners [service providers], there was a whole lot of communication around the mandate but little on the core issues facing the system.
“How did we get to late payments? Nobody is coming out with that truth here.”
Another DA MP, Chantel King, said: “I can’t really say that I welcome the presentations.”
She said the fees charged by one of the commercial banks, which she named, was far cheaper than those levied by the four service providers.
“It’s more accessible and the student can go to a proper ATM. Is the board satisfied that the current system is still more feasible than proper commercial banks?”
But ANC MP Walter Letsie disagreed with King’s assertion that a certain commercial bank levied cheaper fees, saying instead that another bank was cheaper.
Another ANC MP, Brandon Pillay, said he could not understand how the four service providers were awarded contracts “given that a service provider has provided a table that shows that banks were far cheaper in respect of the charges than the service providers”.
“How in the world that was awarded is beyond me. My question to all the service providers is how much are you actually charging students and how much are you making from this?”
Committee chair Nompendulo Mkhatshwa said there was not much from the Norraco presentation “that can alleviate the concerns we have”.
“There’s information that we really wanted from service providers around disbursements of allowances.”
She said service providers should furnish the committee with a breakdown that includes, among other things, the number of students they were supposed to fund at each institution and how many students had been paid each month.
“We will require this within a week from this week.”
Nsfas board chair Ernest Khosa told the briefing that they had received a number of complaints over the direct payment system during their recent bosberaad to discuss the challenges facing the entity.
“Some of the presentations we got at the lekgotla were very detailed and very specific, and for that reason the board felt there was a need to look at those particular elements of the complaints and develop a prompt response to that.”
He said questions asked by the committee, including whether the service providers were registered financial service providers and whether there exists a historical business and tender relationship between the CEO of Nsfas, Andile Nongogo, and a director of Coinvest Africa, would be answered.
The board appointed law firm Werksmans Attorneys to conduct a probe into allegations against Nongogo while he was at the helm of the Services Sector Education and Training Authority (Sseta).
Nongogo was placed on a leave of absence in August after the allegations levelled against him.
Khosa said the report on the investigation by Werksmans Attorneys would be ready within the next 10 working days.
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