Highest-ever student loan drawdowns in Jan

New student loan drawdowns amounted to EUR 327 million in January this year, which shows a year-on-year rise of six per cent and more than ever before in a single month, said the Bank of Finland in a press release on Monday.

The average interest on the student loans drawn down in January was at a record low (0.21%). Euribor-linked loans accounted for 93% of all the new drawdowns, with an average interest of 0.16%.

The increase in the number of drawdowns has meant rapid growth in recent years in the stock of student loans.

At the end of January, the stock of student loans stood at EUR 4.9 billion, with an annual growth rate of 14.6%. The stock of student loans has almost doubled since the reform of student financial aid that came into effect in 2017.

In addition to the increase in the size of loan tranches as a result of the reform of student financial aid, the stock of student loans has also been augmented by an increase in the number of borrowers.

The total number of people with outstanding student loan debt has grown rapidly in recent years.

According to the statistics of the Social Insurance Institution (Kela), in 2019-2020, there were 462,000 people with student debt, when three years earlier the number was 84,000 fewer.

The current low interest rates have also supported the popularity of student loans.