University bosses call for student loans interest to be scrapped for 15 months

2 February 2021, 08:43

The interest on student loans in England should be scrapped for 15 months, a group of top universities bosses says.

The vice-chancellors at seven universities in England are calling on the government to scrap interest on student loans for those whose education has been disrupted due to the coronavirus pandemic.

The period is from the first national lockdown, in March 2020, until summer 2021.

In December 2020, the government announced a one-off fund of up to £20million to help students most in need of support.

Now a further £50million will be available, taking the total to £70million for this financial year.

In a letter, seen by the BBC, to Prime Minister Boris Johnson, Chancellor Rishi Sunak and Education Secretary Gavin Williamson, the vice-chancellors write that this move would ease pressure on students.

The letter, signed by vice-chancellors at East Anglia, Goldsmiths, Essex, Kent, Reading, Royal Holloway and Sussex universities, says: "The pandemic has placed unprecedented pressures on our students.

"In some of our universities, demands for hardship funds have increased by over 100 per cent.

"As a result of the pandemic, students also face extraordinary mental health challenges and 18 per cent of students lack access to a computer, laptop or tablet."

While studying, interest for students is 5.6 per cent. This is made up of the Retail Price Index (RPI) plus 3 per cent. RPI is currently set at 2.6 per cent.

This rate applies until the 5 April after students leave, or for the first four years of a course, unless the RPI changes.