UK government caps student loan interest rates at 6%
Minister says change for plan 2 and 3 loans in England and Wales will ‘protect borrowers’ from impact of global conflict UK politics live – latest updates The interest rate on plan 2 and plan 3 student loans will be capped at 6%, the Department for Education has announced. Graduates with plan 2 loans currently pay interest rates based on the retail price index (RPI) measure of inflation, plus up to 3% based on their earnings. Current students on plan 2 and plan 3 loans attract an interest rate o
Minister says change for plan 2 and 3 loans in England and Wales will protect borrowers from impact of global conflict
Explainer: what the rate cap means for graduates
Millions of graduates will have the interest on their student loans capped at 6% from September as a temporary measure to protect them from the risk of rising inflation driven by war in the Middle East.
Ministers acted after months of criticism over the loans becoming a “debt trap” that often leave graduates in England and Wales paying tens of thousands more than the original loan amount.
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