NSFAS Under Scrutiny for Alleged Tender Rigging in Fintech Awards

NSFAS Under Scrutiny for Alleged Tender Rigging in Fintech Awards

NSFAS Under Scrutiny for Alleged Tender Rigging in Fintech Awards. The National Student Financial Aid Scheme (NSFAS), responsible for assisting financially disadvantaged students, has come under the spotlight amidst allegations of irregularities in awarding tenders to fintech companies. These companies are entrusted with the crucial task of disbursing student allowances directly to beneficiaries, raising concerns about fairness and transparency.

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Awaiting a Crucial Report

NSFAS currently awaits the findings of a report investigating these allegations of tender rigging. Specifically, the concerns revolve around tenders awarded to four fintech firms, tasked with managing student allowance disbursements. The organization anticipates receiving the report within the next 10 working days, after which it will take appropriate action.

Parliamentary Briefing on Multiple Fronts

The NSFAS Board recently briefed Parliament’s oversight committee on various critical issues, such as the direct payment system, student accommodation, and the backlog of application appeals. The organization has been actively addressing these concerns while seeking to enhance its operational systems.

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CEO Special Leave and Allegations of Maladministration

An important development in this matter is the placement of NSFAS CEO Andile Nongogo on special leave in August. This action was prompted by allegations of maladministration from his previous employment. The allegations have also raised concerns about the potential involvement of service providers from his prior role with NSFAS.

Investigating Service Provider Connections

The ongoing investigation aims to determine whether these service providers are registered financial entities and whether there exists a historical business and tender relationship between the CEO and the directors of these companies. Notably, Nongogo was reportedly present and participated in the process of selecting and awarding contracts to the four Financial Service Providers, despite assurances from NSFAS of an independent selection process.

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Evaluating Compliance and Bid Requirements

The upcoming report will also assess whether the awarded companies adhered to the stipulated requirements outlined in the bid advertisements. Concerns have been raised regarding whether these companies applied for tenders only after the requirements were possibly lowered, as none of the four initially submitted applications when the tender was initially advertised.

Denial of Wrongdoing

One of the implicated companies, Coinvest Africa, has denied any wrongdoing and has emphasized that their contract resulted from a legitimate tender process.

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NSFAS Vigilant Efforts

In its efforts to address these challenges, NSFAS is considering the possibility of filing criminal complaints against individuals involved in fraud once the investigations are concluded. This includes efforts to recover R38 million from a college in the Free State. The organization may also pursue criminal and legal action against students and other parties who have defrauded the NSFAS system.

Resolving Student Accommodation Backlog

Another issue NSFAS is actively addressing is the backlog of student accommodation applications. Currently, only slightly over 30.8% of students who applied for accommodation have been accommodated. This backlog is partially attributed to the initial manual system, which has now been replaced with a new accreditation tool aimed at streamlining the process. Accreditors will be able to assess accommodations online and in real-time starting from October 9, 2023.

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Clearing the NSFAS Appeals Backlog

NSFAS also intends to tackle the backlog of appeals related to its applications, with a target to resolve these issues by the end of October.

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