Increased cost of getting a degree

In all probability, the way interest is charged on student loans will be changed.

According to a higher education funding review, there should be a variable interest rate on student loans.

Now, students start paying off their loans when their annual income exceeds £15,000, at a low rate of interest.

It is expected that the tuition fee cap (£3,290) will be removed, and the market will decide how much a degree costs.

Ministers have been weighing all the pros and cons of establishing a a system of tiered interest rates that would be tied to graduates’ income.

Yet, the Liberal Democrat MPs, who made a promise to abandon tuition fees during the election campaign, are opposing the suggestion to increase fees, and an agreement is not expected to be reached soon.

Earlier this year, the Russell Group, which represents elite universities of UK, suggested that borrowers should start repaying their student loans ahead of time and at a higher rate of interest, to avert a major funding crisis.
 


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