Namibia: NSFAF recovered 10 million Namibian dollars in 2021
Last year, the Namibia Student Financial Aid Fund (NSFAF) recovered N$10 million, the highest amount the institution has raised since 2008.
It comes after the NSFAF has struggled to recover funds given out as student loans since it began debt collection in 1997.
Some 131,000 Namibians were funded by the NSFAF between 1997 and 2019.
NSFAF Acting CEO Kennedy Kandume told The Namibian yesterday that in March 2022 alone, they had recovered N$2.1 million.
“And the highest single amount paid by an individual debtor is N$328,000,” he said.
According to the Auditor General’s reports on the NSFAF, in previous years the highest amount recovered by the institution was N$6.2 million in 2013.
In the 2020/2021 financial year, the NSFAF collected only N$4.2 million, and over the past five years it has been unable to collect more than N$4.6 million. Namibian dollars.
Kandume said this was a significant improvement in collecting outstanding debts from former beneficiaries.
“However, this is a small amount compared to the matured loan portfolio of N$4.2 billion,” he said.
From 2008 to 2013, the student fund collected an average of N$5 million per year when debt collection was done in-house.
The Namibian reported in 2018 that the fund had only been able to recover around N$84.6 million since it started debt collection in 1997.
However, when he hired external debt collectors, this amount dropped to N$4 million per year, of which about N$3.5 million per year plus 12% commission was paid to the debt collectors. .
Earlier, Kandume said the struggle to collect debts was due to the lack of a loan book.
“We only had physical files of those who had it before and you couldn’t determine the amount of the loan. Now all those files, of 130,000 [loan holders]have been converted to electronic format to show how much is owed to the fund and who the debtors are,” Kandume said.
The NSFAF’s debt collection exercise has been ineffective over the years, due to alleged poor record keeping.
Last year, when NSFAF management appeared before the public accounts committee, Kandume said in 2011 that it had asked higher education institutions to gather the names of NSFAF-funded students.
In addition, they also asked for bank statements to trace the recipients of the loans.
The NSFAF targets 130,000 alumni who have received funding since 1999.
The fund disbursed a total of N$7.5 billion in loans during this period.
The NSFAF targets debtors who have completed their education and are employed.
In November, the NSFAF pledged to release the names of about 52,000 defaulting students if they failed to repay their loans. Recipients were told to contact the NSFAF within a month or face litigation or be blacklisted.
The fund has previously said it has the ability to obtain court orders to search defaulters’ assets if necessary.
Since then, more than 1,000 debtors have come forward to NSFAF to make payment arrangements to repay the loans.
On Wednesday, President Hage Geingob announced that there would be an amnesty on interest repayments for the next 12 months.
“We welcome the announcement, however, as it gives debtors/former beneficiaries the option to repay their loan interest-free, making it cheaper,” Kandume said during Geingob’s announcement.