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More than £28m of student loan overpayments unclaimed

The government has received more than £28m in unclaimed student loan overpayments, according to research.

It occurred as a result of payments continuing to be taken even after the loans had been paid off in full.

 

The overpayments relate to loans made to students to cover tuition and living costs, the repayments for which are deducted from graduates’ salaries each month.

 

The Student Loans Company said it proactively seeks to contact all customers who have overpaid in order to arrange refunds and that data sharing between government departments has improved to prevent overpayments.

 

The level of unclaimed overpayments was revealed in research published by Research Professional News, a higher education publication.

 

Repayments are meant to stop once the full amount has been paid off, but in 510,000 cases since 2009-10, extra payments were deducted.

 

There was almost £308m in overpayments, averaging about £600 per person. While most of this was paid back, around £28.5m remains unclaimed.

 

A Student Loans Company spokesperson said: "We want all customers to repay the right amount and not to over-repay on their loan. This is why we write to every customer in the last two years of their repayment, inviting them to repay by Direct Debit, as this will stop their employer deducting from earnings and help to prevent over repayment.

 

“We pro-actively contact all customers that have over-repaid to make arrangements for a refund; customers who do not participate in the Direct Debit scheme can also claim a refund at any time by contacting us.”

 

It added that the company has started to receive payment information from HMRC which will help to prevent customers from over repaying and provide them with more up-to-date information about their loan repayment.

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