Future Finance, a specialist student loans company, has raised concerns surrounding students’ abilities to finance their educations. In a survey, which questioned 1,000 full-time students, said that 31% have had to use credit cards, payday loans and overdrafts to finance their university experience.
John Hudson, manager of Funding and Financial Support at the University of Nottingham: “While we do offer assistance to students in hardship who have turned to payday loan providers, and this has clearly been a significant issue over recent years, it’s not clear to us how widespread this is at Nottingham. Certainly it is a relatively small (and probably decreasing) percentage of applicants to hardship funds who have taken out such loans, though we do see a significant number who have non-payday loan-related debt which was acquired prior to starting the course.”
The survey also showed that 70% said their government loans did not fully cover the costs of studying which has meant student have had to find other means to support their education.
Hudson continued “More generally, our experience is that most undergraduate students in receipt of maximum support from Student Finance and a University Bursary should have sufficient funds to cover their costs and that most other students can generally cover their costs with a combination of government support, University support, parental help and part-time work. But of course there is no ‘typical student’ as people have a range of experiences and backgrounds. For this reason we offer the Student Hardship Fund (for students with ongoing financial issues), funds such as the Childcare Support Scheme (to assist student with children with childcare costs) and the Student Crisis Fund (for students with short-term financial problems for reasons outside their control) as well as linking in with the wider network of welfare and other support services across the University.”
The survey also raised concerns about students’ knowledge surrounding finance. A quarter of students in the survey said that they do not define credit cards or pay day loans as a form of debt and 40% said they did not know what APR stood for.
CEO of Future Finance, Brian Norton said: “It is worrying that significant numbers of students rely on credit cards, payday loans and overdrafts without even seeing them as debt.”