Students were already enraged when the plan was still in the coalition agreement, but nevertheless, the minister actually submitted the proposal to the House of Representatives last Tuesday: the interest rate on student loans goes up.
Interest rates on student loans will go up
The Dutch coalition government is raising the interest rate for student loans. But why?…
“Students are being duped by the government into deeper debt,” says LSVb president Geertje Hulzebos. “We call a halt to the government and demand that they cancel this plan.”
Dutch National Students’ Association ISO also makes itself heard. “Once again, students are disproportionately hit hard in their wallets. The government shouldn’t fill their national balance with the precious money of a debt generation,” says president Tom van den Brink.
Higher interest rate means higher repayment. With an average debt of 21,000 euros, the monthly repayment rises from 70 to 82 euros. In the long run, the measure must yield 226 million euros a year.
For repayers, the interest rate is re-established every five years, and that remains the case. Previously, the interest rate was based on the interest that the government itself pays for five-year loans. Soon it will be the interest of ten-year loans, which is slightly higher. Currently the interest rate on student loans is zero percent.
Nothing changes for the current students. The rules will apply to new students starting from 2020.