What is the government’s new 2025 student loan system?

by Brad Fein
Student Loan

In a recent major announcement, the UK government has unveiled plans to radically transform the student finance system by 2025. The proposed system called the Lifelong Loan Entitlement (LLE) will provide more flexible loan funding to help people train, retrain, and upskill throughout their working lives.

As of 2022, the outstanding student loan debt in the United Kingdom reached over 201 billion British pounds. The new scheme plans to help people pay back their student loans, as well as give them some flexibility in the way they study.

What is the LLE (Lifelong Loan Entitlement)?

The LLE is a new system designed to allow more individuals to study in a way that suits them, opening up opportunities for those who may have never considered higher education. It allows people of up to 60 to take out student loans for many types of post-18 courses from degrees to technical qualifications. 

This could help to repay people who balance training or studies alongside other commitments such as childcare or financial commitments. The aim of this is to improve social mobility and reduce skills gaps.

How much can you borrow using the LLE?

Under the new plans, individuals will have access to loans equivalent to four years of post-18 education (£37,000 in today’s tuition fees) under the LLE, which they can use flexibly throughout their working lives. 

This new change aims to transform the student finance system, providing greater opportunities for learning and enabling workers to retrain and upskill to meet the needs of cutting-edge industries and high-paid jobs of the future.

How can you use the LLE to study?

The loan can be used for full or part-time study for a variety of courses, from degrees to Higher Technical Qualifications (HTQs), including modules. This means that people can pursue their studies in a more flexible way, jumping on and off their learning.

To put the technical study on the same level as academic routes, maintenance support will be expanded to be available across all eligible technical and part-time courses the LLE will fund. 

HTQs will also be funded through the new system. These are technical qualifications at levels 4 and 5 (between A level and degree level), which provide essential skills needed for careers from software engineering to nursing to data analysis. 

Under the LLE personal account, HTQs will sit side by side with academic routes, transforming the way these qualifications are viewed.

The LLE will provide funding for new modules of courses, which will be introduced in stages: first for HTQs and some technical level 4 and 5 qualifications from launch in 2025, before expanding to further level 4, 5, and 6 qualifications from 2027. 

Modules must be part of a full course so that they can be stacked towards full qualifications if people wish, with studying picked up and put down throughout people’s working lives as it suits them. Students who have completed modules will receive a standardized transcript, making it easy to transfer credits.

Woman writing on paper

Who can use the LLE?

People up to age 60 will be entitled to the LLE, including returning students who will have access to any remaining funding once previous student loans are taken into account. For instance, this means that people who studied for a three-year degree will still be entitled to one year’s worth of funding, which could be used to fund another short course or module.

To encourage as many people as possible to retrain or return to study later in life, the “Equivalent or Lower Qualification (ELQ) exception rule” will also be removed. Previously, people could not return to study at an equivalent or lower level of qualification than they had already received. 

Under the new system, anyone wishing to retrain or study at an equivalent or lower level will have finance available to do so. The LLE will ensure changing paths is as easy as possible, or support people to upskill in their current career.

The LLE will replace the previous student finance system from the start of the academic year 2025/26.

0 comment

You may also like