University graduates across the UK are being encouraged to check if they’re eligible for a student loan refund, following revelations that nearly £200 million was overpaid last year.
The campaign group Save the Student is urging graduates to take action, as data shows that hundreds of thousands currently paying off loans may be owed a share of £184 million in refunds.
Checking for a potential refund is straightforward; graduates can log onto the government’s Student Loan Company (SLC) portal to see if they are due any reimbursement.
Refund amounts vary widely, from small sums to over £1,000 in some cases.
Tom Allingham from Save the Student highlighted that refunds could make a significant financial difference for many former students.
Charlotte Gill, a graduate who successfully claimed £68, noted that while her refund wasn’t substantial, “every little helps” when managing student finances.
Another former student, Martin De’Ath, received £396, making him realise how much the funds could have helped over the ten months he was without them.
There are four main reasons graduates may be due a refund on their student loan repayments:
1. but Repayments Below the Annual Threshold: The majority of overpayments, totalling £146 million, occurred when individuals were charged despite earning below the annual repayment threshold.
This can happen if graduates briefly exceed the monthly threshold due to factors like extra shifts or bonuses, while still falling below the yearly earnings threshold. To streamline the process, the SLC introduced an online refund request service in May. In the first six months, 418,000 people have already used it.
2. Early Repayments: Some individuals were mistakenly charged before they reached the point when repayments should begin, generally the April after completing their studies.
3. Incorrect Payment Plans: Mistakes in employer processing sometimes put graduates on the wrong repayment plans, leading to overpayments.
4. Payments Beyond Loan Completion: In some cases, former students continued making payments even after their loan was fully repaid.
While overpayments do contribute towards the loan balance, potentially reducing future interest costs, many graduates could benefit from having extra cash now to ease day-to-day expenses. As Allingham pointed out, “With the cost of living crisis still affecting many, even a modest refund can make a real difference.”
Graduates are encouraged to act promptly, check their SLC portal, and claim any money owed to help manage current financial pressures.
