Tag Archives: student loans

More efficient student education loans on the cards

Given that qualification verification has become easily obtainable and accessible in South Africa, for the very first time university and college students have the opportunity to instantaneously confirm and verify the simple fact that they have already registered.

“The actual significance and ramifications associated with this will most certainly be far reaching and significant,” Qualifications Verification Services (QVS) managing director Danie Strydom expressed in a report. ” It indicates, amongst other things, that student education loans could in fact be approved more speedily which would mean that individuals can pay with regard to university tuition and purchase textbooks sooner compared to before,” he explained.

Previously, university students were required to get hold of a letter coming from the college or university to confirm and verify that they previously had registered. This in turn would have to be provided to the bank or financial institution where the student had applied for a student loan. The process in most cases had taken a number of days to make it possible for the financial institution the opportunity to ensure the authenticity of the letter prior to funds becoming readily obtainable.

” Through process of replicating the computer database of the higher education institutions, the entire procedure can now take place online and in real time thereby allowing student registrations verification in seconds as opposed to the days which it took previously,” Strydom pointed out.

QVS’s statement has brought up considerable interest and curiosity, bringing about the gathering of all the major banks where they were fully briefed on the new service. Seven universities have at this time subscribed to the brand new QVS products and services and in addition would most likely implement them soon.

University student registrations and qualification verifications at the present time existing on the QVS database are the University of Johannesburg, Tshwane University of Technology, and the University of the Free State. Various other universities in implementation phases are the University of Stellenbosch, Durban University of Technology, and Nelson Mandela Metropolitan University.

The brand new online service would undoubtedly at the same time help save the banking institutions millions in lost revenue simply by informing them in the event that students had terminated or completed their studies, as a consequence becoming ineligible for the more affordable interest rate student loans. Students would also be responsible to instantly commence the repayment of their student loans.

Banking and financial institution face the risk of losing millions of rand every year by students absconding and never paying back their student loans. The new QVS product and system will provide banking institutions together with other role players, which include trustees of bursary funds, updated regarding the status of each and every student on a day-to-day basis according to Strydom.

Students would also be obligated to grant authorization to have their details and particulars made known on the database and in turn would have complete access to the database to ensure and guarantee that the correct information and facts ended up being viewable.

The system and database is secure and fully automated in the sense that computers, as opposed to individual human beings, performed and managed the data processing. The system may additionally be audited to make certain that absolutely no mistakes or errors slipped in, he explained.

Source: Sapa, studentloanshelp.org, onlineloans4all.com, eduinreview.com, collegecareerlife.net

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Nzimande in poor students corner

While Higher Education Minister Blade Nzimande has rejected calls for free education for all, he has vowed to present a “compelling case” for poor students to get a better deal.

Nzimande is, in the light of the review committee report on the National Student Financial Aid Scheme (NSFAS), pushing for the state to consider using the scheme as a basis to introduce free undergraduate education for needy students.

The NSFAS report, which has been compiled by a panel led by Professor Marcus Balintulo, has recommended radical changes in the way the scheme operates and calls for changes to policy regulations including the distribution formula for the allocation of financial aid to institutions.

But even Nzimande is aware that such changes may take a little longer to yield the desired results and some of the committee’s recommendations may even be rejected by Cabinet.

With Cabinet expected to make a decision on the matter by August, Nzimande has vowed to make a case for his strife for free education for financially needy and academically deserving students.

Nzimande told BuaNews: “We think that this report… all those stakeholders should actually study it closer and respond to it and also of course take into account that government does have limited amounts of funds but (we need to see) where we can start together.

“We are not starting from scratch, NSFAS has already supported hundreds of thousands of students, but how do we then strengthen it and be able to move closer to the goal of free higher education at least to undergraduate level for poor students.”

Although the minister pointed out that a number of prospective students who require NSFAS to further their education were from families where there was – in some instances – no bread winners, Balintuli was not shy to note that during its work, the committee was faced with the dilemma of having to separate between the responsibility of the state and that of parents.

“It’s a matter that we really struggled with in trying to determine what is the responsibility of the state and the expected family contribution because whatever we had to recommend had to touch on the review of the founding formula of NSFAS,” he said.

But the matter was up Nzimande’s alley – at least in principle. “It’s nice to talk about parental responsibility when you can afford (to pay).The reality is that most students cannot afford,” he said.

For what he calls “the missing middle”, Nzimande wants NSFAS to review the current policy that allows the scheme to assist only students whose household income is less than R122 000 per annum. He argues that there are many parents who earn up to R160 000 per annum but cannot afford to send their children to institutions of higher learning.

“The scheme does not take into account that it may happen that we are earning R150 000 but we have got two kids at university and you will still not qualify. So those are the things the report is helping us to properly grasp and understand”.

The panel also suggested that the race-based model for allocating funds be replaced by a class-based model using solely socio-economic criteria, while acknowledging the continuing overlap between race and class in post-apartheid South Africa.

While many have suggested there might be a link between financial difficulties and the recurrent violent protests at universities, Nzimande said reasons for the protests are varied.

“What we’ve found for instance this year, because we have set up a registration task team just to oversee what is happening, is that sometimes its just lack of proper communication amongst the stakeholders and that includes management.”

Student bodies in varsity campuses nationwide have recently protested against financial exclusion.

Nzimande said the task team had identified weaknesses in the administrative system where students in some institutions get thrown out erroneously while others get accepted.

“So those are some of the things that cause a problem at the beginning of the year but that does not lead to denying the fact that one of the biggest challenges is financial exclusion on the grounds that some students cannot afford to pay and NSFAS has not been able to reach all of them,” he added.

While Nzimande has been clearly sympathetic to the call for free education since assuming the ministry in May last year, he has been equally clear in his message that only financially needy and academically deserving students should be considered if and when a free education system finally emerges. For now he doesn’t want to “pre-empt” the discussions at Cabinet and all he has vowed to do is present a “compelling case”.

Source: BuaNews

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Report lifts lid on financial aid scheme

The Department of Higher Education could soon instruct the National Student Financial Aid Scheme (NSFAS) to stop deducting money from past beneficiaries of the scheme without their consent.

Currently past students who owe NSFAS and who are now working are having their salaries deducted by employers without their consent and the money is paid straight to the scheme.

But a ministerial committee tasked to review NSFAS on Tuesday released its much-awaited report that is set to bring drastic changes in student funding. It also demands NSFAS to remove all students it has black listed on credit bureaus.

The committee, led by professor Marcus Balintulo has also recommended changes to the policy, regulations and operational framework of the NSFAS to allow the scheme to absorb more needy student who wished to further their education.

It says the Minister of Education Blade Nzimande should on constitutional, legal and moral grounds instruct NSFAS to immediately stop all loan recoveries from past students without their consent and refrain from using this method in its dept recovery practice.

NSFAS is a state-funded initiative formed in 2000 to assist financially needy students enter institutions of higher education.

The scheme replaced Tertiary Education Funds of South Africa (TEFSA) which was formed in 1991.In 2005, the scheme awarded R1.2 billion to financially needy students who wished to further their studies.

The committee, which spent more than eight months reviewing the scheme, has further recommended the investigating the introduction of a constitutionally compliant section of the NSFAS Act to enable NSFAS to recover loan repayments directly through the taxation system.

It wants government to revalue the NSFAS loan book to assess the accuracy of the R10 billion valuation and that the revaluations should be done timeously to allow the minister to report any adjustment to parliament prior to the financial year end.
“The committee also recommends that NSFAS should not blacklist students with credit bureaus and should remove the names of all students currently black listed with the TransUnion ITC credit bureau and or any other credit bureaus,” said the report.

Speaking later to BuaNews Nzimande said while he was not expecting Cabinet to agree all the recommendations saying “we will be presenting our case”.
“I don’t want to preempt a discussion in Cabinet, all we would like to do to the best of our ability is to present a compelling case,” Nzimande said.

He affirmed that while the report touched on many issues, not all of them can be solved in a short period of time.

“We have to go to Cabinet and say what is it that we think its feasible but that we want to increase access to poor students is non-negotiable”.

The panel has also recommended that government investigate whether to expand the categories of students admitted to universities, to include people with work experience and no matric, and end the criteria of using race as major criteria to award financial assistance to students.

Research has shown that only between 12 and 15 percent of black and coloured students gain entrance to higher education and only about five percent graduate. There is also evidence that some white students had been refused assistance even though some may have proved to be financially needy.

Nzimande slammed universities who were still demanding NSFAS students to pay registration fees in cash despite a directive from his predecessor Naledi Pandor urging universities to rather deduct the money from the scheme.

“It’s nice to talk about the parental responsibility versus state responsibility when you can afford. But the reality is that most students cannot afford these registration fees and some are from families with no bread winner at all,” he said.

The recommendations will be released for public comment.

“We want the country to engage on especially the stakeholders; many of them have participated in the process and were already interviewed. We’re talking students, academics, university management, workers and what the committee is saying is that the report has benefited immensely from the comments of the stakeholders,” Nzimande said.

The minister conceded that while the recommendations may require a major financial injection into the scheme and the higher education sector in general, a consideration needed to be made as to where the line should be drawn between state responsibility and that of parents.
NSFAS has provided study loans an estimated 250 000 students. The scheme fund receives about R2.1-billion a year from the government. –

Source: BuaNews, nsfas.co.za,

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NSFAS student loans and bursaries

South Africa is home to many world-class universities and colleges, and you’re smart and want to get ahead in life. How are you going to pay for your studies?

Studying is an expensive undertaking. You can expect to pay between R10 000 and R20 000 for each year of undergraduate study at a South African university. Specialised or professional degrees, such as medicine, can cost much more.

South Africa also has a wide range of private colleges, where tuition fees can be higher than at the subsidized public institutions. Be sure to consider your options before deciding how to pay for your studies, and apply for any award or bursary for which you’re eligible.
University financial aid

If you have already enrolled at a university, or are considering doing so, their financial aid office should be your first stop. Most universities offer bursaries or grants to students that have excelled in their previous studies or on the sports field. Check with your university’s financial aid office whether you are eligible for any of these bursaries or awards, and make sure that you apply before the closing date.

National financial aid

If you are a South African citizen you may be eligible for a National Student Financial Aid Scheme (NSFAS) loan for study at one of the country’s public higher education institutions. The NSFAS, a statutory body funded by the Department of Education, provides study loans to academically able but financially needy students.

Much of an NSFAS loan can be converted into a bursary, which does not then need to be repaid, depending on one’s academic progress. A 100% pass rate would result in a 40% bursary rebate on an NSFAS loan.

The size of the initial NSFAS loan ranges from R2 000 to R30 000. You should apply at your university’s financial aid office.

External bursaries

Many South African companies offer bursaries to promising students.

The terms of these bursaries vary tremendously. Contract bursaries require you to “pay back” the bursary by working at the company once you’ve completed your degree – giving you a job and work experience immediately after your graduation. Many mining and engineering companies, in particular, provide contract bursaries.

The Bursary Register, available at most high schools and at your university’s financial aid office, will provide you with a full list of bursaries available in your particular field.

Student loans

All of South Africa’s major banks offer student loans, both to South Africans and to non-South Africans with valid study permits. Bank loans, unlike NSFAS loans, will also cover studies at a private institution.

When applying for a bank loan, you will have to show proof of registration at an educational institution. You’ll also need somebody, such as a parent or guardian, to sign surety for you.

Although you will only need to start repaying your bank loan once you’ve completed your studies, you will need to keep up the interest payments throughout the term of the loan.

Paying your own way

You can also choose to pay your own way. By taking a year off to work before studying, or by working part-time while pursuing your studies, you can gain valuable work experience while earning to finance your degree.

You’ll have to be disciplined, however, to make sure that you set aside enough time for both your studies and your work, and to make sure that you don’t fall behind in either.

Source: southafrica.info, ssw.uga.edu, nyu.edu, nsfas.org.za

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Banking

Significant Points

•    Office and administrative support workers constitute 2 out of 3 jobs; tellers account for about 3 out of 10 jobs.
•    Many job opportunities are expected for tellers and other office and administrative support workers, because these occupations are large and have high turnover.
•    Many management positions are filled by promoting experienced, technically skilled professional personnel.

Nature of the Industry

Banks safeguard money and valuables and provide loans, credit, and payment services, such as checking accounts, money orders, and cashier’s checks. Banks also may offer investment and insurance products, which they were once prohibited from selling. As a variety of models for cooperation and integration among finance industries have emerged, some of the traditional distinctions between banks, insurance companies, and securities firms have diminished. In spite of these changes, banks continue to maintain and perform their primary role—accepting deposits and lending funds from these deposits.

Goods and Services

Banking is comprised of two parts: Monetary Authorities—Central Bank, and Credit Intermediation and Related Activities. The former includes the bank establishments of the Federal Reserve System that manage the Nation’s money supply and international reserves, hold reserve deposits of other domestic banks and the central banks of other countries, and issue the currency we use. The establishments in the credit intermediation and related services industry provide banking services to the general public. They securely save the money of depositors, provide checking services, and lend the funds raised from depositors to consumers and businesses for mortgages, investment loans, and lines of credit.

Industry Organization

There are several types of banks, which differ in the number of services they provide and the clientele they serve. Although some of the differences between these types of banks have lessened as they have begun to expand the range of products and services they offer, there are still key distinguishing traits. Commercial banks, which dominate this industry, offer a full range of services for individuals, businesses, and governments. These banks come in a wide range of sizes, from large global banks to regional and community banks. Global banks are involved in international lending and foreign currency trading, in addition to the more typical banking services. Regional banks have numerous branches and automated teller machine (ATM) locations throughout a multi-state area that provide banking services to individuals. Banks have become more oriented toward marketing and sales. As a result, employees need to know about all types of products and services offered by banks.

Community banks are based locally and offer more personal attention, which many individuals and small businesses prefer. In recent years, online banks—which provide all services entirely over the Internet—have entered the market, with some success. However, many traditional banks have also expanded to offer online banking, and some formerly Internet-only banks are opting to open branches.

Savings banks and savings and loan associations, sometimes called thrift institutions, are the second largest group of depository institutions. They were first established as community-based institutions to finance mortgages for people to buy homes and still cater mostly to the savings and lending needs of individuals.

Credit unions are another kind of depository institution. Most credit unions are formed by people with a common bond, such as those who work for the same company or belong to the same labor union or church. Members pool their savings and, when they need money, they may borrow from the credit union, often at a lower interest rate than that demanded by other financial institutions.

Federal Reserve banks are Government agencies that perform many financial services for the Government. Their chief responsibilities are to regulate the banking industry and to help implement our Nation’s monetary policy so our economy can run more efficiently by controlling the Nation’s money supply—the total quantity of money in the country, including cash and bank deposits. For example, during slower periods of economic activity, the Federal Reserve may purchase government securities from commercial banks, giving them more money to lend, thus expanding the economy. Federal Reserve banks also perform a variety of services for other banks. For example, they may make emergency loans to banks that are short of cash, and clear checks that are drawn and paid out by different banks.

Interest on loans is the principal source of revenue for most banks, making their various lending departments critical to their success. The commercial lending department loans money to companies to start or expand their business or to purchase inventory and capital equipment. The consumer lending department handles student loans, credit cards, and loans for home improvements, debt consolidation, and automobile purchases. Finally, the mortgage lending department loans money to individuals and businesses to purchase real estate.

The money banks lend comes primarily from deposits in checking and savings accounts, certificates of deposit, money market accounts, and other deposit accounts that consumers and businesses set up with the bank. These deposits often earn interest for their owners, and accounts that offer checking provide owners with an easy method for making payments safely without using cash. Deposits in many banks are insured by the Federal Deposit Insurance Corporation, which guarantees that depositors will get their money back, up to a stated limit, if a bank should fail.

Source: bls.gov,

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