'I Owe More Than I Borrowed': Why Thousands of UK Graduates Say Britain's Student Loan System Is Broken

When marketing specialist Matthew Brown checked his student loan balance earlier this year, he discovered it had risen to about £93,000 despite years of repayments.

Brown, 29, from Gosforth, Newcastle, told the BBC that he had borrowed around £62,000 to complete his undergraduate and master's degrees at the University of Hull. Yet between 2019 and 2026, his outstanding balance continued to grow because interest was added faster than he could repay it.

'I don't think I'll ever pay it off,' Brown told the broadcaster, describing the experience as 'really frustrating'.

His story reflects the concerns of many graduates across England who say the country's student loan system has become a long-term financial burden rather than a stepping stone to opportunity.

Why Many Graduates Owe More Than They Borrowed

For many young Britons, university remains one of the most common routes into professional careers. However, a growing number of graduates are finding themselves owing significantly more than they originally borrowed.

The issue is no longer simply the cost of tuition. Instead, it stems from how England's student finance system combines interest charges with income-based repayments, allowing loan balances to continue increasing even while borrowers make regular payments.

Unlike conventional bank loans, student loan repayments are based on earnings rather than the total amount owed. While this protects lower earners from unaffordable monthly repayments, it also means many graduates repay less each year than the interest added to their balance.

As a result, some borrowers may never fully repay their loans before the remaining balance is written off under the terms of their repayment plan.

For many graduates, however, the psychological impact can be just as significant as the financial one. Watching a debt grow year after year despite making repayments has left many questioning whether they are paying off a loan at all or simply servicing accumulating interest.

Student Debt Extends Beyond Tuition Fees

The financial burden often stretches well beyond university tuition.

Many graduates also leave higher education with maintenance loans taken out to cover rent, transport and day-to-day living costs. Those who continue into postgraduate study may accumulate even more debt before entering full-time employment.

At the same time, many are trying to save for a first home, build careers and manage rising living costs. Although student loan repayments increase and decrease with earnings, the deductions reduce take-home pay for years and can influence major financial decisions, including buying property, starting a family and saving for retirement.

Increasingly, graduates describe student loan repayments as feeling less like temporary borrowing and more like a long-term deduction from their income.

Graduates Say the System Feels Like a 'Life Tax'

Brown's experience is far from unique.

The Guardian also reported the case of 27-year-old postgraduate graduate Peters, who finished her undergraduate degree with more than £60,000 in student debt before taking out another loan to complete a master's degree. Her total borrowing rose to around £77,000.

She described the repayments as feeling like 'a life tax', saying she does not expect to clear the debt during her working life.

Campaigners argue these experiences are becoming increasingly common, particularly among graduates who pursued postgraduate qualifications or entered professions where additional study is effectively expected.

According to the Student Loans Company, outstanding student loan debt in England reached £294.6 billion during the 2025–26 financial year. Accrued interest accounted for more than £12 billion of the annual increase, fuelling renewed calls for reforms that campaigners say would make the system fairer and easier for borrowers to understand.

Does the Current System Still Deliver Value?

Supporters of the current model argue that income-contingent repayments ensure higher education remains accessible regardless of a student's financial background. Because repayments only begin once graduates earn above a specified threshold, those on lower incomes contribute less.

Critics, however, argue that rising tuition fees, accumulating interest and changing repayment terms have fundamentally altered the balance.

Higher education has long been viewed as a driver of social mobility, giving students from lower-income backgrounds access to opportunities that might otherwise be out of reach. Yet some campaigners believe that if graduates spend decades carrying substantial debt, the system risks undermining that objective.

Calls for reform have grown in recent years, with proposals ranging from reducing interest rates to changing repayment terms and improving transparency so prospective students better understand the long-term financial implications before taking out loans.

Whatever changes policymakers ultimately consider, one question continues to resonate with many graduates: why does the amount they owe keep increasing despite years of repayments?

For borrowers such as Brown and Peters, that question has become central to the wider debate over whether Britain's student loan system still delivers on its promise of expanding opportunity without creating decades of financial anxiety.