The Bank of Britain has told the government it wants to offer the country’s private student loans the same relief as a government loan, if needed.
The Government is considering the idea of offering private student loan holders the same repayment relief as other government loans and other loans for a “time-limited” period of time.
In a statement, the Bank of Scotland said: “We believe that private student debt should not be treated as a public benefit, as a Government funded scheme would be.”
The Bank of Great Britain also said it was “considering whether we can extend this loan relief to the private sector in the UK”.
The issue of private student debts has become a hot topic for both sides of the Brexit debate after the Bank said last week it had no plans to offer any relief to people who had taken out a private loan from Lloyds Banking Group.
Under the terms of the Bank’s loan guarantee scheme, the Government and private lenders could agree to set up an “exchange fund” for private loans to cover any shortfall from a loan that was paid back in full.
Bank of England governor Mark Carney has said private student lenders are a “hugely valuable part of the market” and that it was right for the Bank to set aside some funds for private student borrowers.
It has been reported that the Bank would consider a “Time-Limited Private Student Loan Relief” as a solution to the problem of private debt, as it does not want to see people continue to take out loans and default on their loans in the same way they did before.
A spokesperson for the Office for National Statistics said the Office of National Statistics “is not in a position to comment” on the Bank decision.
More to come.