This month, DUO will inform students about the new interest rate for 2026. Based on interest trends over the past year, it will likely be set at 2.3 percent, down from the current 2.57 percent.

For many years, the interest rate was zero percent: borrowing cost nothing extra. But that didn’t last. In 2023, it rose to 0.46 percent, and a year later it jumped to 2.56 percent. This caused shock among students who had assumed borrowing was free. Another year later, it inched up by one hundredth of a percent to 2.57 percent.

There have been years with much higher student loan interest rates. In 2008, for example, the rate was over four percent. In the 1990s, loans were even more expensive, with rates between six and ten percent. In 1992, students paid more than 11 percent.

The official calculation of the rate for next year has not yet been published and may vary slightly. The Ministry bases it on the interest the government itself must pay on state loans with terms of 4.5 to 5.5 years.

During studies

Interest on student loans accrues while students are still in school. For example, at a rate of 2.57 percent, a €10,000 loan grows by €257 in one year.

After graduation, students get a two-year interest-free “grace period,” after which repayments start in January. In principle, students have 35 years to repay their debt, plus up to five optional pause years. Any remaining balance at the end of the 35 years is forgiven.

The total interest can add up significantly. For instance, repaying a €10,000 loan over 35 years at 2.57 percent interest would result in nearly €5,900 in interest payments.

“The interest rate reduction is far from sufficient,” says Sarah Evink, chair of the Interstedelijk Studenten Overleg. “It’s precisely the students who come from less financially advantaged families who have to borrow the most. That interest creates significant inequality between students who receive financial support from their parents and those who don’t.”

DUO provides an online calculator and has improved its guidance on interest. For borrowers, the rate is fixed for five years at a time. Those who started repaying in 2023 still have a rate of 0.46 percent, which will remain in effect until January 2028.

Legal case

Outraged students wanted to file a lawsuit over the 2023 rate increase, arguing that DUO had provided inadequate information. However, nothing further came of this case. Recently, a judge ruled in an individual case that the government is allowed to adjust the interest according to the established rules.

This article focuses only on the system in which repayment is spread over 35 years. In the old student finance system, graduates had to repay within fifteen years, and interest was calculated differently. Some former students are still in that system.

This article was translated using AI-assisted tools and reviewed by an editor.