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The Government is set to overhaul the student loan system, which will enable graduates to view their loan account online, replacing the current annual paper statements.
This new online service is due to be rolled out across the country this year and, according to the Government, will make it easier for graduates to understand their balance, manage their loans and avoid over-repaying. It also said that those who prefer the existing paper statements will still be able to receive them.
Commenting on the changes, universities minister Chris Skidmore, said: “With more and more people enjoying the benefits of a university education, it’s only right that graduates have easy access to the information they need about repaying their student loan.
“The Government is investing in the student loans system to make it as simple and easy for people to use as possible. I urge all graduates to use this new service and to join the direct debit scheme as they approach the end of their loan to ensure a smooth end and not repay more than they should.”
A student loan is offered to those studying as a way of paying tuition fees. The loan is paid directly by the Student Loan Company to the university, as a result students never have direct access to the funds. In addition to a student loan, students can also apply for a maintenance loan. The maintenance loan is paid directly into the student’s bank account and is designed to help students with the cost of living during their time at university.
Rachel Springall, finance expert at Moneyfacts.co.uk said: “It’s positive to see these plans coming together for graduates who want easier access to their student loan information. It can be costly to fund an education so its vital students are aware of how much they will need to pay back and to make sure they are making comfortable repayments.
“Before consumers even start out as a student, it would be wise to take some time to compare student bank accounts and decide whether they will need to take on a part-time job to earn some additional cash. If they set themselves up well financially initially, they may be able to limit the amount they borrow using an overdraft, which they would need to pay back once they finish their education. The right account can also provide some cost-saving incentives or even tools to keep on top of everyday transactions.”
For more information about managing money as a student, read out guide on how to manage finance as a student.
As well as this, many banks offer bank accounts specifically designed for students and a full list of student bank accounts can be found here.
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