Guide discussion: Plan 5 student loans

Ed-1

LL_USS said:

silvercar said:

Ed-1 said:

silvercar said:

I’m surprised that the interest rate, which is linked to RPI, can drop from 8% to 4.3% in one month! 

RPI dropped from 13.5% to 4.3% over the year to March.

So why does this link show an interest rate of 7.7% for March? https://www.gov.uk/guidance/how-interest-is-calculated-plan-5

I do not know how last year we had the rate month by month and this time round it is a rate announced for the whole academic year.

silvercar said:

Ed-1 said:

silvercar said:

I’m surprised that the interest rate, which is linked to RPI, can drop from 8% to 4.3% in one month! 

RPI dropped from 13.5% to 4.3% over the year to March.

So why does this link show an interest rate of 7.7% for March? https://www.gov.uk/guidance/how-interest-is-calculated-plan-5

The prevailing market rate cap was operating as it was lower than the RPI rate. Under the Teaching and Higher Education Act 1998, the interest rate on student loans taken out after 2012 cannot be higher than the rate prevailing on the market for commercial unsecured loans.