Hundreds of thousands of graduates owed refunds after making incorrect student loan repayments

Publication Source

1. UK graduates paid back £100m in student loans while below threshold | The Guardian

Hundreds of thousands of graduates could be owed refunds after making “incorrect” student loan repayments.

Save The Student, a website providing free, impartial advice to students on finance, found that over 850,000 graduates made unnecessary student loan repayments during the 2021/22 financial year. The majority have not claimed a refund.

The new data, acquired through a Freedom of Information (FOI) request to the Student Loans Company, finds that the total value of these erroneous payments exceeded £100m.

Out of the 856,475 graduates that overpaid, just two per cent have claimed a refund. The figures further identify that 39,000 graduates mistakenly made early repayments, with over 50,000 continuing to make repayments despite having cleared their balance.

Elsewhere, over 200,000 repaid their student loans debt under the wrong plan type.

Typically, graduates who have cleared their balance and have continued to make payments are automatically issued a refund, but Save The Student has warned that this isn’t always the case for others that overpay.

At present, UK universities can charge a maximum of £9,250 per year for an undergraduate course, with graduates obligated to repay tuition fee loans, maintenance loans and postgraduate loans.