Student loans in the United Kingdom consist of two elements — a tuition fee loan and a maintenance loan for living costs — with repayment thresholds, interest accrual and total debt levels differing across the four nations and across different loan plans.
Student loan debt, repayment terms and graduate earnings: key facts explained
Student loans in the United Kingdom consist of two elements — a tuition fee loan and a maintenance loan for living costs — with repayment thresholds, interest accrual and total debt levels differing across the four nations and across different loan plans.
Most students are entitled to a tuition fee loan equal to the annual cost of their course. Maintenance loans are means-tested, meaning the amount a student can borrow depends on household income and may not cover actual living expenses.
The maximum maintenance loan for students in England is set to increase by inflation each year from 2026. For 2026-27, the maximum for students from England living away from home outside London will rise to £10,830, up from £10,544 the previous year.
Interest is charged on the total loan from the day it is taken out, but repayments do not begin until a graduate's annual income reaches a specified threshold. Once that threshold is crossed, a single regular payment covers both the tuition fee and maintenance loan.
Repayment rules changed in England in 2023, with current and future students expected to repay over a longer period than those who studied earlier. Graduates who became liable for repayment in April 2026 had an average debt of £47,730, according to the Student Loans Company, down from £53,000 the year before.
The Student Loans Company attributed part of that decline to the first cohort of Plan 5 borrowers — introduced in England in 2023 — becoming eligible to repay. Plan 5 loans accrue less interest than the earlier Plan 2 loans, and Plan 5 borrowers accounted for more than 10% of all borrowers in the 2025-26 financial year.
MPs launched an inquiry into student loans in England this year, citing what they described as 'widespread dissatisfaction' over repayment terms. Repayment obligations can extend for up to 40 years once graduates earn above the income threshold.
Research published in 2024 by Hepi and AdvanceHE found that 45% of undergraduate students considered the value for money of their course 'good' or 'very good', up from 37% the previous year and the highest proportion recorded in more than ten years.
Government statistics from 2024 show median pay for working-age graduates was £42,000, compared with £30,500 for non-graduates. However, those figures do not account for external factors such as prior academic attainment.
The Higher Education Statistics Agency has said that, accounting for inflation, graduate wages have declined in real terms, with the extent of the decline varying by occupation. Graduates surveyed in 2022 were earning £448 per year less on average, measured against 2015 prices, than counterparts who graduated three years earlier.
Research published in 2020 by the Institute for Fiscal Studies found that, on average, women who study creative arts or languages earn the same over their lifetime as women who did not attend university, while women who study law, economics or medicine earn more than £250,000 more over their careers than non-graduates. Men who studied creative arts earned less on average over their lifetimes than male non-graduates, whereas male graduates in medicine or economics earned £500,000 more.
- The specific income threshold at which graduates in England must begin repayments is not stated.
- The income thresholds applicable under Plan 2 versus Plan 5 loans are not compared.
- The repayment terms applicable in Scotland, Wales and Northern Ireland are not detailed.
- The inquiry launched by MPs into student loans in England has not yet reported findings; those findings are not available in the source.
- The 2020 IFS research covers England; whether its findings apply to the wider UK is not stated.
- The source does not state the current annual tuition fee cap in England or elsewhere in the UK.
- No government, university sector, or Student Loans Company response to the MPs' inquiry or to broader dissatisfaction with repayment terms is included.