1.8 million owe £50,000 in UK student debt

A newly released data reveals that almost 1.8 million people in the UK are burdened with student debt exceeding £50,000. Among them, over 61,000 individuals have balances above £100,000, and 50 people owe more than £200,000, according to the Student Loans Company (SLC).

Between 2017/18 and 2021/22, the number of Nigerian students in the UK increased from 10,685 to 44,195, marking a 314% rise, second only to India's 517% growth rate. The impact of this debt on Nigerian students remains unclear.

The data, obtained via a Freedom of Information (FOI) request, highlights the number of loan holders with above-average debts eligible to start repayments. Previously, the average balance for English loan holders starting repayments was under £45,000; new government data shows it has risen to £48,470. Balances are particularly high for those who study multiple or lengthy courses, often increasing rapidly due to interest.

In the 2023/24 period, approximately 2.8 million people in England made student loan repayments. This indicates that while only a small fraction of repayers owe more than £100,000, the majority have debts exceeding £50,000.

Earlier this year, the BBC reported the highest UK student debt was over £231,000; this figure has now reached £252,000. Tom Allingham from Save The Student described these balances as "alarming" but "in no way indicative of the norm." Personal finance expert Martin Lewis compared student debt to a "limited form of graduate tax," explaining that repayments are based on income, with 9% of earnings above a threshold being deducted.

For instance, those on "Plan 2 loans" pay 9% of everything earned over £27,295. The National Union of Students (NUS) criticized the lack of student finance reform in political campaigns. Student debts are written off after 30 or 40 years, depending on the course and start date.

Graduates with heavy debts have expressed concerns about the current system. Titi, a senior electrical engineer from Croydon, has seen his debt rise by £788.11 in just two months, totaling over £128,200. He feels it is impossible to repay the balance in full due to high interest rates driven by inflation, and worries that potential students might be discouraged from higher education due to these financial burdens.

Since tuition fees were tripled in England over a decade ago, costs have reached a maximum of £9,250 per year across the UK, except in Scotland where Scottish students pay up to £1,820. Many who borrowed large sums on "Plan 2" loans are unlikely to repay the full amount, according to Ben Waltmann from the Institute for Fiscal Studies. Professor Claire Callender noted that such high debts negatively impact graduates' lives.

The SLC's data indicates that fewer than 50 people owe a collective £10 million. Nick Hillman, director of the Higher Education Policy Institute, highlighted the inefficiency of the system at these debt levels, suggesting that those individuals will not fully repay their loans.

The SLC explained that higher-than-average balances might result from multiple student loan products, including Advanced Learner Loans and funding for various undergraduate and postgraduate courses. Additional factors include multiple or lengthy courses and additional funding for compelling personal reasons.

Despite being over £101,500 in debt, foundation year 2 doctor Abbie Tutt appreciates that student loans do not affect credit scores. However, she is disheartened by the lengthy repayment period compared to older colleagues with more favorable terms. Dr. Tutt views her debt as a tax and questions the value of higher education given the financial burden.

NUS vice president for higher education Chloe Field pointed out that means-tested maintenance loans lead to higher debts for working-class students, who also tend to repay loans slower and incur more interest. Save The Student's Allingham expressed shock at the number of graduates with debts exceeding £200,000.

The Conservative government has frozen tuition fees and ensured no one pays back more than they borrowed in real terms. However, both major parties have yet to propose new measures on tuition fees or student debt. Labour acknowledges the current system is flawed and promises future reforms, while the Liberal Democrats advocate reinstating maintenance grants and reviewing higher education finance. The Green Party aims to abolish tuition fees, and Reform proposes scrapping student loan interest.

The Department for Education declined to comment due to pre-election period restrictions.