Huge rise in number of students complaining about handling of loans

Complaints made by students and graduates about the handling of their loans have almost quadrupled in the past five years, new figures reveal.

The number of grievances lodged against the Student Loans Company (SLC) by disgruntled borrowers rose from 1,411 in 2005-06 to 5,648 in 2010-11.

This year’s total was more than double the 2,566 complaints in the previous financial year, according to the statistics obtained by the Independent on Sunday (IoS). An itemised account of grievances against the SLC, obtained after a Freedom of Information request, shows that more than a third were “collections disputes” in 2005-06.

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“Arrears and agency issues” were among the highest categories of complaint in subsequent years, with other grievances including lengthy delays in the payment of loans.

Aaron Porter, president of the National Union of Students, told the IoS: “The complaints demonstrate students’ growing dissatisfaction with all parts of the higher education funding system.”

The SLC came in for fierce criticism in 2009 after it failed to process around 200,000 student loans and grants by the beginning of term.

An SLC spokeswoman said: “The increase in complaints highlighted for 2010-11 represents an increase in customers who were previously assessed by local authorities.”