Government to sell some of the student loan book
The authorities in the UK have decided to sell a part of its student loan book in order to boost its financial position but the move is likely to trigger student protests across university campuses as it might lead of higher debt burden on students.
The government had announced in June that it is planning to sell student loans to private firms before the elections. The sale will include £900 million of debt on loans taken up by the students mainly in the 1990s in the country. The government has earlier sold student loans twice but this will be the largest sale and will help in reducing public debt.
Treasury chief secretary Danny Alexander has confirmed the sale and indicated that it will include to the students in the 1990s, which are much like mortgage payments and not income-based repayment loans that currently being offered to the students. The coalition wants to sell the entire stock of student debt, which has a face value of around £40 billion and it is believed that the loans will only be profitable for the firms if the interest rates are increased, which might increase debt burden.