The repayment of student loans, which includes borrowers from Wales, is governed by the Education (Student Loans) (Repayment) Regulations 2009 (as amended). Department officials are in regular contact with the Devolved Administrations and will continue to liaise with them on Student Loan Repayment policy.
The current system protects borrowers if they see a reduction in their income. Repayments are made based on a borrower’s monthly or weekly income, not the interest rate or amount borrowed, and no repayments are made for earnings below the repayment thresholds. Repayments are calculated as a fixed percentage of earnings above the relevant repayment threshold - if income drops, so do repayments made. Any outstanding debt is written off at the end of the loan term with no detriment to the borrower.
If, at the end of the year, the borrower’s total income is below the relevant annual threshold, they may reclaim any repayments from the Student Loans Company made during that year.