22,000 students told to pay back ‘mis-sold’ maintenance loans
22,000 Students Face Repayment Demands for ‘Mis-Sold’ Maintenance Loans
Over 20,000 students have been informed that they were incorrectly awarded maintenance loans and grants, now requiring them to return the funds immediately. These students, enrolled in weekend-based courses, received notifications from the Student Loans Company (SLC) or their institutions stating their programs were ineligible for such financial support. A letter from the SLC, obtained by the BBC, highlights that the university misinformed them about the weekend-only nature of their studies, leading to an overpayment.
Impact on Affected Institutions
Several universities and colleges, including London Met, Bath Spa, and Oxford Brookes, are implicated. The courses involved featured in-person classes on weekends and some online sessions during the week. Students had secured loans and, in some cases, childcare grants based on these programs. Universities UK issued a joint statement attributing the issue to a government decision, while the Department for Education blamed students for “incompetence or abuse of the system.”
Loan Structure and Repayment Terms
Maintenance loans are designed to cover living expenses, such as housing and food, and are means-tested using household income. Unlike tuition fees, which are directly paid to institutions, these funds go to students. Repayments begin after graduation and when earnings exceed a specified threshold. Childcare grants, however, do not require repayment for eligible recipients.
Franchise Models and Financial Strain
Some courses are delivered through franchise agreements, where a smaller organization partners with a university to offer the program. The SLC advised students facing financial hardship to seek assistance, suggesting universities might provide support. Khawaja Ahsan, a student at the University of West London, shared his struggle: “I feel betrayed and massively let down.” He had taken out a maintenance loan and childcare grant totaling £14,335, which he now risks repaying.
“They’re worried, they’re not sleeping, they don’t know where they’re going to find the money,” said Amira Campbell, president of the National Union of Students. Many affected students work part-time to fund their studies, and the sudden demand for repayment has caused significant stress. Campbell noted that many are from working-class backgrounds, unable to quickly access large sums.
Recently, a group of students studying a four-year acupuncture program received temporary relief as the SLC reversed its stance, restoring their eligibility. These students, set to take final exams, had been pressured to repay £37,000. One woman, who was supporting herself through a minimum-wage job, broke down in tears before the decision was made, pleading for time to adjust.
