Is NSFAS a Bursary or Loan​? Everything You Need to Know Before Applying

The National Student Financial Aid Scheme (NSFAS) is a South African government programme designed to provide financial support to students from disadvantaged backgrounds. It helps students at public universities and TVET colleges cover the cost of tuition, accommodation, and other study-related expenses. However, when applying for funding, many students are often unsure: Is NSFAS a bursary or loan? This confusion is common, and understanding the difference is important when planning for higher education.

In this article, we will examine NSFAS’s history and explain how the system works today to clarify whether it is a bursary or a loan. We will also explore its repayment terms, eligibility requirements and benefits. 

NSFAS as a Loan: Historical Perspective

While you wonder, ‘Is NSFAS a bursary or loan’, it is essential to know its history. Initially founded in 1991 as the Tertiary Education Fund of South Africa (TEFSA), NSFAS mainly operated as a loan scheme. This programme aimed to provide financial support to students from disadvantaged backgrounds so they could afford their education. 

Under the initial system, students received loans with the understanding that they would need to repay them after graduating. Once a student found a job and earned above a certain income threshold (initially set at R80,000 per year), a portion of their salary would be deducted to repay the loan. However, if the students did not complete their studies or were unemployed, they could delay repayments until they started earning a suitable income.

Find out the difference between NSFAS and Fundi

NSFAS Transition: From a Loan to a Bursary-Based System

In recent years, particularly since 2018, NSFAS has transitioned from a loan-based system to a bursary model. This change was part of broader government efforts to enhance access to education and lessen the financial burden on low-income families. While understanding ‘Is NSFAS a bursary or loan?’, you should know its shift from a loan scheme to a bursary-based system. 

Here is a concise overview of this transition:

• 1991-2017: NSFAS functioned as a loan scheme until December 2017, placing long-term repayment obligations on students.
• 2018: NSFAS became a bursary scheme, allowing students from households earning less than R350,000 per year to receive financial aid without repayment, provided they meet academic requirements.
• 2024: NSFAS introduced loans for the “missing middle,” supporting students with household incomes between R350,000 and R600,000. This initiative is aimed at providing assistance to students who do not qualify for NSFAS bursaries.

Therefore, the answer to the question, “Is NSFAS a bursary or a loan?” is that it operates as a government-funded scheme designed to provide both bursaries and loans for students. This dual approach allows NSFAS to support a wide range of students, ensuring that financial assistance is accessible to those who need it most.

See the NSFAS 2025 application dates

Understanding the NSFAS Bursary

Today, NSFAS provides financial support through bursaries to eligible students who maintain satisfactory academic progress and complete their studies. Students receiving these bursaries are not required to repay the financial aid, which eases their financial burden. Besides, the NSFAS bursary covers the following educational-related costs:

• Tuition fees
• Accommodation
• Learning materials
• Meals
• Transport 
• Living allowance 

Additionally, NSFAS oversees several other government bursaries, such as the Funza Lushaka Bursary for future teachers, and manages the collection of repayments on loans issued before 2018.

So, to answer the question, “Is NSFAS a bursary or loan?” , we can say that the current model highlights that NSFAS mainly functions as a bursary scheme. However, it is important to note that NSFAS also provides loans, particularly for those who do not qualify for bursaries, ensuring that financial assistance is accessible to a broad range of students.

Eligibility for NSFAS Bursary

Students must meet specific criteria to qualify for bursary from the National Student Financial Aid Scheme (NSFAS). So, while trying to find the answer to, ‘Is NSFAS a bursary or loan?’, you must understand the requirements to be eligible for this funding. The eligibility criteria for the bursary are as follows:

• Applicants must be South African citizens.
• Applicants must be SASSA grant recipients to qualify for funding.
• Applicants must have a combined household income not exceeding R350,000 per year.
• Applicants with disabilities must have a household income not exceeding R600,000 per year.
• Applicants who started studying before 2018 must have a household income of no more than R122,000 per year.
• They must be intending to study at public universities or TVET colleges.
• They must maintain satisfactory academic performance throughout their studies.

Find out the list of courses funded by NSFAS

Benefits of NSFAS as a Bursary

When the NSFAS scheme transitioned from a loan-based system to a bursary model, it brought several benefits for students and their families. Here are the main advantages of the NSFAS bursary:

• No repayment required: Students who successfully finish their studies do not have to pay back the funds they received.
• Reduced financial burden: The bursary helps lighten the financial load for low-income families, making it easier for them to afford higher education.
• Encouragement of academic success: Knowing they won’t have to repay the funds motivates students to perform well in their studies.

Know More About how to check NSFAS status

NSFAS Loan vs. Bursary: What’s the Difference?

Since students often ask, “Is NSFAS a bursary or loan?” understanding the difference between the NSFAS loan and the NSFAS bursary is crucial when considering financial aid for higher education. The following table outlines the key differences between these two, helping to clarify their respective requirements and benefits.

Learn How To Apply For NSFAS

Conclusion

The National Student Financial Aid Scheme (NSFAS) has changed over the years, shifting from being a loan system to focusing mainly on providing bursaries. This transition helps students from disadvantaged backgrounds access higher education without the burden of repayment. While the current model predominantly offers bursaries that do not require repayment, it also includes loans for those who fall into the “missing middle” income bracket. Therefore, understanding the answer to the question ‘Is NSFAS a bursary or loan?’ is essential for students seeking financial aid, as this knowledge helps them make informed decisions about their educational futures.

Visit Regenesys’s Reginsights page now to get access to more information on NSFAS funding!

Is NSFAS a Bursary or Loan? – FAQs