Canada to eliminate interest on federal student loan payments
Canadians paying back their student loan fees may be seeing a financial lifeline coming soon.
On Thursday, Deputy Prime Minister and Minister of Finance Chrystia Freeland announced within the Fall Economic Statement that hope is on the horizon.
“We are permanently eliminating interest on the federal portion of Canada Student Loans and Canada,” she said.
It would apply to Canada Student Loans and Canada Apprentice Loans, “which will offer important relief for all current and future new graduates coping with the high cost of living.”
The statement says it would include those currently being repaid and start beginning on April 1, 2023.
“This change has an estimated cost of $2.7 billion over five years and $556.3 million ongoing,” the statement explained.
“An average student loan borrower will save $410 per year as a result of their loan being interest-free. They will still be able to use the Repayment Assistance Plan, allowing them to pause student loan repayment until they make at least $40,000 per year, and reducing payments for those earning slightly above that threshold.”
Freeland says more details will be coming soon.
“I will be announcing new measures and major new measures in the coming weeks and months. We understand that times are particularly tough right now and for that very reason our government will be there for Canadians with assistance for our students and for our most essential workers as well. Because many of them are very poorly remunerated.”
More to come…
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