Defaulting students will have their contact details handed over by tax authorities, Sars to NSFAS for loan repayment purposes.
The National Student Financial Aid Scheme (NSFAS) says it will use personal information obtained from the SA Revenue Service (Sars) to chase people who not heed to their call for repayments of their loans when they get jobs.
Last week, SARS last week permits NSFAS to have access to further non-financial information of former students with unpaid student loans.
“NSFAS will make contact with your employer to confirm employment and then contact you (the debtor) to discuss repayments in line with the signed loan agreement,” said NSFAS spokesperson Kagisho Mamabolo.
The information of those former NSFAS scheme beneficiaries registered with Sars will reveal the ID numbers, addresses, contact details and employers’ names. Sars revealed last week that the new provision falls the Tax Administration Act, which allows SARS to provide other non-financial information such as addresses and other contact details.
Mamabolo said defaults in repayments of loans prompted this move. “Most debtors were not heeding our call for them to inform us as soon as they find jobs, leading to us struggling to confirm if they are working or not. Sars will be able to assist us with that information, in cases where the concerned individuals are not coming forward,” said Mamabolo.
Students are required to start repaying their loans if they earn R30 000 or more annually. Payments start at 3% of debtors’ annual salary, increasing to a maximum of 8% when the salary reaches R59 300 or more per year.
NSFAS said action will be taken against former students who fail to repay while employed as the scheme is a registered credit provider.
“The scheme reserves the right to follow the normal debt recovery process which may lead to action taken against those who fail to repay loans even though they can afford to do so,” said Mamabolo.
Two months ago, minister of higher education and training, Blade Nzimande, said in parliament that NSFAS had spent R41.1-billion in loans and R20.4-billion in bursaries between 2000 and 2015.
In the wake of #FeeMustFall protests, the government raised its contribution towards NSFAS from R6.5-billion in 2015/16 to R11.4-billion this year. Part of the amount aimed at helping the “missing middle” students, whose parents earned over the required maximum to qualify for the loan, still couldn’t afford the fees.
Tax records, however will not be part of the information given to NSFAS.
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