STUDENTS and recent graduates face another blow to their pockets after it emerged maximum interest rates are set to rise this autumn.
From this September, students will pay up to 6.3 per cent, after a rise in the Retail Prices Index (RPI).
But ministers insisted only graduates earning more than £45,000 would be affected.
The rise from the current 6.1 per cent will take effect from September for students and graduates under the 2012 fee scheme.
The change affects students in England, Wales and Northern Ireland.
It comes amid continued concerns about the debt burden on students and whether students are getting value for money.
A review of higher education, formally announced by Theresa May in February, is due to examine the role of interest rates on student loans.
Students can get Government-backed loans to cover the cost of their tuition fees – which stand at up to £9,250 a year in England, as well as to help with living costs.
After they graduate, interest is charged on a sliding scale, with those earning over £45,000 paying the maximum of 6.3%.
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Graduates do not have to begin repaying their loans until they are earning £25,000, and those earning under this amount are charged interest of 3.3%.
A Department for Education spokesman said that the Government’s decision to raise the repayment threshold to £25,000 from £21,000 will save 600,000 graduates up to £360 a year.
He said: “Once the loans are in repayment, only borrowers earning over £45,000 are charged the maximum rate. This ensures that they make a fair contribution to the system.”
But Shadow education secretary Angela Rayner said: “Students are graduating with over £50,000 in debt, and face these interest rates from the moment they begin their courses, causing their debt to skyrocket during their time at university, when they cannot even begin to pay it back.”
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