UK to cap student loan interest at 6% amid inflation concerns
Indian Express·2h ago·Hope
What Happened
Britain will cap student loan interest rates at 6% from September 2026 for plan 2 and plan 3 loans. The government cited Middle East conflict risks and inflation concerns as reasons for the intervention. The move overrides the previous formula linking rates to inflation plus 3 percentage points. An estimated 5.8 million people hold plan 2 loans. Skills minister Jacqui Smith stated the cap protects borrowers from temporary inflation spikes caused by global shocks.
Key Entities
BritainUK student loansPlan 2 and Plan 3 loansKeir StarmerJacqui SmithDepartment for Education6% interest rate cap5.8 million borrowers