Students 'will benefit from govt's new loan scheme'

A new student loan scheme will benefit scholars, it has been said.

Student account holders are set to benefit in the long-term from the government's new loan system, an expert believes.

Recently, the Conservative-Liberal Democrat alliance unveiled changes to how scholars will have to go about repaying the personal loans they receive throughout their time at university.

These alterations - which are set to come into effect next year - will mean only high earners will have to repay the full amount of their loan before debts are written off some 30 years after an individual finishes their degree course.

And according to Ed Bowsher, head of consumer finance at Love Money, this represents a "big plus-point" for those planning to go into higher education in the near future.

On the other hand, he warned this scheme will also result in ex-students paying interest at "rates higher than inflation".

This comes after an official from Moneyfacts noted parents could help their children going to university by saving cash before they leave home.

By Joe Letts