Graduates are paying £18,000 extra on their student loans because outdated measure of inflation is being used to calculate interest

‘Graduates will pay as much as £18,000 extra on their student loans because an outdated measure of inflation is used to set their interest rates.
The retail prices index used by the company that manages the loans is almost always higher than the more modern and accurate consumer prices index.
It means the total £93billion debts of students in England and Wales incur £368million a year extra interest than if the consumer prices index (CPI) was used.
A student starting university in September who borrowed £45,000 and earned £41,000 in their first job will repay around £107,000 over 29 years using interest based on the retail prices index (RPI). If CPI was used, they would repay £89,000 over 26 years – £18,000 less.’
Read more: Graduates are paying £18,000 extra on their student loans because outdated measure of inflation is being used to calculate interest