Finance Expert Criticizes UK’s New Student Loan Payment Tool

Category: Education/Family


Unlocking Word Meanings

Read the following words/expressions found in today’s article.

  1. outstanding / ˌaʊtˈstæn dɪŋ / (adj) – unpaid

    My phone service will be cut if I don’t pay my outstanding bills.

  2. debtor / ˈdɛt ər / (n) – a person or group who owes money

    The loan company allows debtors to pay online.

  3. intimidate / ɪnˈtɪm ɪˌdeɪt / (v) – to cause someone to feel afraid to do something

    The students were intimidated by the difficult math homework.

  4. write off / raɪtˌɔf / (phrasal) – to officially say that money owed no longer needs to be paid

    The new law aims to help poor farmers by writing off all their government loans.

  5. balance / ˈbæl əns / (n) – the amount of money that someone still needs to pay

    We still have a balance of $50 that we need to pay by next week.


Read the text below.

Finance expert Martin Lewis criticized the United Kingdom’s new student loan quick repayment tool, saying that it can lead to poor financial decisions.

The UK government’s Student Loans Company (SLC) recently redesigned its website by introducing a new tool to make it easier for graduates to repay their outstanding loans. The organization said that the introduction of the new tool was based on customer suggestions. However, Lewis finds the SLC’s move to be dangerous and irresponsible because the new tool can allegedly mislead people.

He said that the website may confuse debtors about the amount they need to pay and even intimidate them because the first thing they see upon logging into the site is the total amount of debt they owe in large font. However, Lewis pointed out that no matter how much the graduates owe in total, they only need to pay a fixed amount based on their income every year, and making overpayments would not change the amount they still need to pay in succeeding years. In addition, graduates are only required to make payments on their debts for 30 years, and all unpaid debt will be written off after this period.

Lewis added that the quick repayment tool does not help clear any confusion because it lets people make payments without logging in or fully understanding how much they need to pay each month first.

In response to Lewis’s criticism, an SLC spokesperson said that the new tool is the most advanced student loan service ever made available, and that contrary to Lewis’s claims, the new service was actually created as a way to prevent graduates from making excessive repayments. He added that the website redesign was the company’s response to customers’ demand for a quick and easy way to manage their accounts and check their loan balance online.

Viewpoint Discussion

Enjoy a discussion with your tutor.

Discussion A

• Do you believe the SLC that the new tool could prevent graduates from making excessive payments, or do you think that it’s misleading? Why?
• Do you think that the SLC should do something to the tool based on Lewis’s criticism (e.g. remove it, improve it)? Why or why not?

Discussion B

• Should students have to take out a loan to go to school? Why or why not?
• Do you think the government should make education completely free? Why or why not?