Student loans firm charges too much

Published on Tuesday 14 December 2010 17:22

The Student Loans Company (SLC) has taken more than £15 million in overpayments from former students, according to new research.

Using Freedom of Information requests, Which? magazine found 57,000 ex-students are waiting for refunds from SLC after excess repayments were taken from their accounts despite having paid off their loans in full.

Student loans are repaid through monthly Pay As You Earn instalments that are managed by HM Revenue and Customs (HMRC).

While SLC is supposed to notify HMRC when a loan has been paid in full, Which? found some students were still making repayments 11 months after the loan was repaid.

One ex-student had to wait over six months for his excess repayments to be refunded and even then his refund was two months short.

Which? chief executive Peter Vicary-Smith said: "How is it possible that for at least the second year running the Student Loans Company has overcharged ex-students by millions of pounds?

"We know that paying off a debt is a stressful experience, so the last thing people need is to find that they've been paying out more than they needed to."

Former students can avoid being overcharged by calling the loans company when they are close to paying off their loan in full.