To ask the Chancellor of the Exchequer, with reference to the covid-19 outbreak and the Bank of England’s reduction in interest rates, what plans he has to reduce the interest rates applied to Plan 2 Income Contingent Repayment student loans.
8 June 2020
The system for setting interest rates on student loans is set out in The Education (Student Loans) (Repayment) Regulations 2009, as amended.
Student loans have much more favourable terms than commercial loans and the Government regularly monitors the interest rates set on student loans against the interest rates prevailing on the market. The most appropriate comparators for undergraduate student loans are the effective interest rates available on unsecured personal loans, as published by the Bank of England (data series CFMBJ77 and CFMBJ94).
We continue to monitor Covid-19 impacts on students and work to understand the issues they face.