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A bill to simplify the student loan system and encourage borrowers overseas to pay back debt passed last night.
For borrowers living overseas The Student Loan Amendment bill introduces a repayment holiday of up to three years, new repayment obligations, extension of interest-free loans to full-time undergraduates, and extension of the amnesty for those who have fallen into arrears with their payments.
Other changes in the bill included a reduction in the late payment penalty for all borrowers, and allowing data matching between Inland Revenue and Customs to ensure correct entitlement to interest-free loans.
Tertiary Education Minister Michael Cullen and Revenue Minister Peter Dunne said the changes brought the rules into line with the aims of interest-free loans.
"By making it easier for them [people doing OE or holiday jobs] to repay their student loans and avoid mounting debt, we remove a disincentive for them to return to New Zealand when they are ready," they said in a statement.
- NZPA
