Johannesburg - Financial services provider eZaga claims its systems are geared up and running smoothly to disperse payments without further delays to registered students despite the growing backlash against it.
The eZaga online digital banking service, tasked with dispersing direct payments to National Student Financial Aid Scheme (NSFAS) beneficiaries, has come under fire in recent weeks for its alleged failure to pay allowances to university students at the Tshwane University of Technology (TUT).
The service provider was appointed alongside Coinvest, Tenetech and Norraco Services to disperse funds to beneficiaries in universities and TVET colleges.
A project manager at eZaga, Ismail Ally, said they tendered for the project around May/June last year and were awarded the tender in July, when they then started the necessary work in compliance with all the banks.
Ally said towards the end of the year, they started payment runs with college-funded students as well as those at TVET institutions as advised by NSFAS around November 2022, and had been successful.
He said the plan for this year was to start again with registering and rolling out allowances to students in colleges, which was again successful.
Ally said they had also offered an R89 bundle; however, following up with students after the first few payments run indicated that they did not make use of all the options available.
For that reason, he said they then relooked at their strategy and introduced the cheaper R29 bundle with fewer options.
He claimed the issue of defunded students was not their fault and that it was, in fact, NSFAS that gave them onboarding files with which students could register a bank account and make calls to defund some.
“Students need to realise their status is determined by NSFAS, and if there are issues about registration and all of a sudden not being funded, it is ultimately the duty of NSFAS and not us.”
“We had a conversation with NSFAS to say to them that the timing of defunding wasn’t impeccable because we are introducing a new system. So automatically, as a student, you would not understand the ecosystem and end up blaming us because, for the past few months, you were getting your allowance.”
Ally alleged that from their side, they had above 90% of students registered and would be able to effect payment of allowances with no hiccups.
However, he did note that part of the delays in effecting payments was as a result of students registering at the last minute for the new payment system, even though they had sent out a communiqué for them to register for their allowances.
“It’s unfortunate that the roll-out of the new payment system happened during the end of exams of the semester, which resulted in most students being off campus. However, at the moment, we’re sitting well above 90% of our university students on the system, so in terms of the next payment run, it’s going to be fairly easy to release the payments.”
Despite this assurance, ActionSA's legal director, Alistair Shaw, reported that the party intended to take legal steps to challenge the awarding of the NSFAS Direct Payment of Allowances contract.
The crux of the legal challenge was that there was a burden placed on students who bore the cost of what was termed “fraud” through excessive fee structures.
In addition to that, they alleged the “NSFAS Bank Accounts” provided by the four inexperienced service providers offered significantly more expensive solutions than those offered by four of the largest commercial banks in the country, all of whom were unsuccessful bidders.
They also alleged that NSFAS had neglected to conduct thorough consultations and that the functionality of the onboarding and registration portals was disorganised and problematic.
The Star