The House has approved a measure on Wednesday that gives an approval to ensures lower interest rates on loans for students that are looking to join colleges this fall season.

President Obama has already said that he will sign the bill that sets market-based student loan rates that will be lower compared to the previous year. A total of 392 members of the House voted in favour for the measure and 31 voted against the measure on Wednesday. The measure would reduce the loan rates for students to 3.86per cent this year compared to 6.8 per cent interest rate from 1 July, 2013.

The new loan rate would be retroactive and will take effect from 1 July, 2013. The bill will now go to the president's office and is set to be signed soon to become a law. Unsubsidized loans and graduate loans were paying 6.8 per cent interest rates in the country.

Minnesota Republican John Kline, who runs the House education panel said, "My colleagues and I have been fighting for months for a long-term market-based solution that will serve students and taxpayers, and the legislation before us today will do just that."