Dutch student loan interest rises for former students, drops for current borrowers

Former Dutch students will face slightly higher interest rates on their student loans over the next five years, the Dienst Uitvoering Onderwijs (DUO) announced. For current students, the interest rate on loans will decrease from 2.57 to 2.33 percent.

DUO said about 260,000 people will see their new interest rate take effect in January. For alumni repaying their debt over 15 years, the interest rate will rise from 2.21 percent to 2.29 percent.

Those repaying over 35 years will see rates drop slightly from 2.57 to 2.33 percent. Both rates remain significantly below the 2.95 percent recorded a few years ago.

Currently, around 780,000 former students are on 15-year repayment plans, and approximately 264,000 are on 35-year plans.

Sarah Evink, chair of the Interstedelijk Studenten Overleg (ISO), described student loan interest as “like a slot machine. Your future is at stake. For the first time in three years, the interest rate has dropped. That is a huge relief for students, but it also shows the percentage can change unexpectedly each year. There is constant uncertainty about the fluctuating costs of borrowing.”

Evink added that despite the drop, student loan interest remains a major expense. “Life is extremely expensive, the basic grant is far from sufficient, and students are forced to borrow. Even with a 2.33 percent rate, (former) students still pay more than half of their debt in interest.”