NSFAF Recovers Less Than 1% of Student Debt, Auditor Flags Loan Management Concerns

NSFAF Recovers Less Than 1% of Student Debt, Auditor Flags Loan Management Concerns. The Namibia Students Financial Assistance Fund (NSFAF) recovered just N$18.2 million out of a total N$1.82 billion in outstanding student loans by the end of the 2024 financial year, according to a report by the Auditor General. This accounts for less than 1% of the total student debt, raising concerns about the Fund’s loan recovery systems and operational effectiveness.

Auditor General Junias Kandjeke’s audit of NSFAF’s financials for the year ending 31 March 2024 revealed that most student loans remain unpaid for several years, with little evidence of follow-up efforts to contact defaulters or address non-payment.

The report highlighted the absence of updated or approved operational procedures. While NSFAF adopted the International Public Sector Accounting Standards (IPSAS), many internal guidelines are outdated—some last revised in 2017—and still reference staff who have since left the organisation. Kandjeke noted that these documents fail to clearly outline the full loan management process from disbursement to repayment tracking.

Due to these issues, the Auditor General issued a qualified audit opinion, though he confirmed the financial statements otherwise fairly represent the Fund’s financial position under IPSAS.

Loans that matured between 2013 and 2017 now account for 67% of the total debt and are considered non-performing. These loans, along with others under the Fund’s policy of low-interest rates, represent a total credit risk exposure of N$10.3 billion. Only 1,400 of the over 120,000 loan recipients are currently repaying.

The report also addressed legacy loan records inherited from the Ministry of Education when NSFAF became an independent entity. Inaccurate records have hindered efforts to assess the full value of outstanding obligations.

Despite financial strain, NSFAF is expected to continue operations until its full reintegration into government, scheduled for October 2025. Upon reintegration, it will cease to operate as a standalone statutory entity.