Student loans: Former university students urged to for refunds

There are four reasons people may be eligible for refunds.

The main reason, behind £146m of the total, is that repayments were taken from people despite them not earning above the annual threshold at which point repayments automatically kick in.

This can happen when someone earns above the monthly threshold which triggers the beginning of loan repayments, due to things like to taking extra shifts, getting a new job or receiving a bonus, but their annual earnings might still fall below the yearly threshold.

Since May, those who fall into this category have been able to use a new service offered by the SLC to request refunds online, external. In the first six months of the service, 418,000 people have done so.

Other reasons may be that former students are charged repayments before they are required to pay, which is generally in the April after they finish studying.

Some people may have been put on the wrong payment plans by their employer, while others may have continued making payments after their loan had been paid off in full.

Any money overpaid does count towards the full repayment of the loan, and may save graduates money in the long run on interest.

However, as Mr Allingham said, many university graduates may need the cash for their day-to-day expenses.

“It is definitely worth doing, particularly even with the cost of living crisis still lingering on a little bit, having that extra boost of cash right now could make a world of difference,” Mr Allingham said.