Students: Loans
The question
To ask the Secretary of State for Education, what assessment she has made of the level of interest rates on student loans.
Answered by Josh MacAlister
Student loans are subject to interest to ensure that those who can afford to do so contribute to the full cost of their degree.
Interest rates do not impact monthly repayments made by student loan borrowers. Regular repayments are based on a borrower’s monthly or weekly income, not on interest rates or the amount borrowed. Outstanding debt, including interest built up, is cancelled after the loan term ends (or in case of death or disability) at no detriment to the borrower.
A full equality impact assessment of how the student loan reforms may affect graduates under Plan 5, was produced and published in February 2022 and can be found here: https://www.gov.uk/government/publications/higher-education-reform-equality-impact-assessment.
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