By Gabi Khumalo
The Department of Education has given lower income earners an opportunity to save for their childrens education at colleges and university.
In partnership with the private sector, Education Minister Naledi Pandor has unveiled the pilot Fundisa Fund project.
Through this project, parents will be able to send their children to university or Further Education and Training Colleges by joining an investment scheme for only R40 per month.
The three-year pilot fund will offer financial assistance to academically deserving students and parents will receive a bonus each year as a reward for saving for their childs education.
Speaking at the launch, Minister Pandor said the recent protests at tertiary institutions against fee increases, highlighted the need for the Fundisa Fund.
"It is a complimentary fund for academically deserving students, the fund cant meet the full costs of the higher education but it is an opportunity for people to start saving,' said Ms Pandor.
She said the fund will create an incentive for low incomer earners. "Its an affordable and long-term investment, most people spend more than R40 on beers and pay-as-you-go airtime,' said Ms Pandor.
She challenged the private sector to increase their support by investing to the minds of the communities, adding that the project would be managed by responsible and competent members.
The department has allocated R20 million to the scheme and National Student Financial Aids Scheme (NSFAS) has committed R21 million.
Chief Executive Officer (CEO) of Collective Investments Di Turpin, said they will be working closely with NSFAS.
The fund will compliment existing funding mechanisms provided by NSFAS in the form of accessible student loans for qualifying low-income families.
She further explained that Fundisa was one of the initiatives being launched by the industry to encourage better saving habits. Collective Investments were an ideal vehicle because of their low costs and highly regulated environment, Ms Turpin said.
"Its a flexible product designed to meet the needs of South Africans, no fees to be paid upfront or penalties if you miss payment at the end of the month. Savers will receive up to a quarter of what they save each year as a bonus,' said Ms Turpin.
Explaining the criteria for people who want to join the fund, Ms Turpin said investors must have either a "Mzansi or other transaction bank account and a bar-coded identity book.
Another great feature of the fund is that one can sponsor any learner they choose, you do not have to be related to the learner, Ms Turpin explained
Fundisa Application Form