22,000 students told to pay back ‘mis-sold’ maintenance loans
22,000 Students Face Repayment Demands for ‘Mis-Sold’ Loans
Over 20,000 students have been informed they were incorrectly awarded maintenance loans and grants, now required to return the funds immediately. These individuals, enrolled in weekend-based programs, received correspondence from the Student Loans Company (SLC) or their institutions stating their courses were not eligible for financial aid. A letter from the SLC, reviewed by the BBC, noted that universities provided misleading details, failing to mention the students only attended classes on weekends.
The affected courses span 15 universities and colleges, including London Met, Bath Spa, and Southampton Solent. These programs featured in-person sessions on weekends and, in some instances, online learning during weekdays. Students had applied for maintenance loans and, for some, childcare grants, believing their enrollment met the criteria. Institutions involved, as per a joint statement from Universities UK, attributed the error to a sudden government policy shift, contemplating legal action against the decision.
Repayment and Financial Strain
The Department for Education criticized students for being “let down by incompetence or abuse of the system,” emphasizing the need for repayment after graduation when earnings exceed a certain threshold. Maintenance loans, intended to cover living expenses, are means-tested based on household income and distributed directly to students, unlike tuition loans which go to universities. Childcare grants, however, are non-repayable for qualifying applicants.
“They’re devastated. 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.
Khawaja Ahsan, a student at the University of West London, is among those impacted. He received a maintenance loan and childcare grant totaling £14,335, which he now faces repaying. “I feel betrayed and massively let down,” he stated, highlighting the difficulty of covering a lump sum with part-time work income.
Franchise Models and University Strategies
Some courses are delivered under franchise agreements, where a larger university contracts a smaller entity to run the program. The SLC advised students to seek assistance if repayments caused “financial difficulties,” suggesting universities might offer support. A temporary relief was granted to a group studying a four-year BSc in acupuncture, which includes 25 days of clinical practice annually. These students, some nearing final exams, were initially ordered to repay £37,000, prompting emotional reactions from those facing sudden financial pressure.
Despite the reprieve, most of the 22,000 students remain in limbo, struggling to repay substantial amounts. The NUS reported that universities have set mid-April deadlines for students to confirm their continued enrollment. Many affected individuals, often from working-class backgrounds, rely on part-time jobs during the week to fund their studies, leaving them in a precarious position.
