22,000 students told to pay back ‘mis-sold’ maintenance loans

22,000 students told to pay back ‘mis-sold’ maintenance loans

Over 20,000 learners have been informed that they were wrongly awarded financial assistance for living expenses and now must return the funds. This affects individuals enrolled in weekend-based programs, who received correspondence from the Student Loans Company (SLC) or their educational institutions stating their courses were not eligible for maintenance loans or childcare grants. A letter from the SLC, shared with the BBC, highlighted that the university submitted inaccurate data, failing to note the student’s part-time attendance schedule.

The dispute centers on courses offered at 15 universities and colleges, including London Met, Bath Spa, Leeds Trinity, Southampton Solent, and Oxford Brookes. These programs included in-person instruction on weekends, with some also providing online modules during the week. Students had applied for loans and, in certain instances, grants, assuming their enrollment qualified for support.

“The stress of it is making me ill, to be honest. I don’t have that money.” – A student facing repayment of £37,000 while working a minimum-wage job

Universities UK issued a collective statement addressing the issue, attributing it to a government decision that was implemented hastily. They mentioned potential legal action against the policy. The Department for Education, however, blamed students for “incompetence or abuse of the system,” according to the BBC.

Maintenance loans are distributed to students in regular installments to cover daily living costs, such as rent and food. These are means-tested based on household income, distinct from tuition fees, which are paid directly to institutions. Repayments begin once graduates secure employment above a certain income threshold. Some affected students also received childcare grants, which are not reclaimable.

A subset of cases involves degree programs delivered through franchise agreements, where a smaller entity collaborates with a university to offer courses. The SLC urged students to seek additional help if repayment posed financial strain, suggesting universities could provide support. Amira Campbell, president of the National Union of Students, described the situation as deeply distressing.

“They’re worried, they’re not sleeping, they don’t know where they’re going to find the money,” she said. Khawaja Ahsan, who recently finished a BSc in cyber security at the University of West London, is among those impacted. His total financial aid, including a maintenance loan and childcare grant, amounts to £14,335, which he may now need to refund. “I feel betrayed and massively let down,” he stated, noting his and his spouse’s part-time work has left them unable to cover the repayment.

Later on Wednesday, a few students received temporary relief as the SLC reversed its decision, allowing them to retain their payments. These students are pursuing a four-year BSc in acupuncture, which combines weekend classes with 25 clinic-based days annually. Two weeks prior, they were given a short notice to repay loans immediately, leading to emotional reactions. One woman, set to take final exams, broke down in tears when asked about her financial concerns, requesting anonymity due to uncertainty.

As of now, most of the 22,000 affected students continue to struggle with repaying significant sums. The National Union of Students reported that some universities have set a mid-April deadline for students to decide whether to continue their courses. The situation has left many grappling with the financial burden of their education.