Foreign Students’ Loan Repayment Rates Raise Concerns

By the Editorial Team · Sunday, August 2, 2026

The UK government is facing concerns over low repayment rates of student loans granted to foreign nationals, with some groups repaying significantly less than domestic students, raising fears of potential exploitation of the system. In response, officials are working to tighten eligibility criteria and close loopholes, particularly around third-party course providers, to safeguard the financial sustainability of the loan program.

The UK government has faced scrutiny over the repayment rates of student loans issued to foreign nationals, amid concerns that significant sums may not be recovered. According to recent figures, more than £15.5 billion in student loans were distributed to UK students in the last year, with a notable proportion granted to non-UK residents.

Romanians were the largest group of foreign borrowers, receiving nearly £1.25 billion in loans. Out of these, 24,773 individuals obtained loans for tuition fees and 25,727 for maintenance. Polish students followed, taking out almost £313 million in loans with 6,827 receiving tuition fee loans and 6,544 maintenance loans. However, repayment rates among these groups have raised alarms: only 45% of Romanian borrowers honored their repayment agreements, compared to 58% of Polish borrowers.

Broadly, the repayment rate for most foreign nationals lags behind that of UK students, who collectively repaid 68% of their loans during the 2024-2025 period. Of the 200 nationalities included in the data, only 14 matched or exceeded the repayment performance of UK nationals. Nepal had the highest repayment percentage at 79%, followed by Paraguay at 77%. Other countries with relatively strong repayment rates include India (70%), the Philippines and Bhutan (both 74%), and Malawi (71%).

The eligibility for student loans is determined by immigration status and residency rather than nationality, and repayments are income-dependent, occurring after graduation. Nonetheless, some officials have questioned the integrity of the system. Neil O’Brien, shadow minister for policy renewal and development, highlighted that a significant number of foreign students may be exploiting the loan system. He suggested that some enroll in UK courses primarily to access loans they do not intend to repay, viewing them as “a blank cheque” that does not require repayment once the borrower leaves the country.

The Department for Education acknowledged the issue, emphasizing that strict eligibility requirements based on residency are in place. The department also noted ongoing efforts to ensure repayment continues even after borrowers leave the UK. They identified franchised provision—where courses are delivered by third parties—as a particular source of concern due to insufficient regulation. The government stated it is actively working to close loopholes and prevent misuse of the student loan system.

Certain nationalities showed particularly low repayment rates, with Kuwaitis repaying only 17% and Gibraltarians 21% of agreed loans during the reported period. Other groups with repayment rates below 35% included borrowers from Comoros, Cyprus, Macau, Djibouti, Honduras, Chad, Oman, Suriname, French Guiana, the United Arab Emirates, Laos, Algeria, and North Korea. Additionally, borrowers with stateless status repaid just 32% of their loans.

As the government addresses these repayment challenges, the focus remains on balancing access to education financing with ensuring the financial sustainability of the student loan program.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.