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Students stung by loans company

Graduates have been refunded £107 million over the last 13 years as a result of overpaying the student loans company, according to official figures released today.

Mistakes usually occur when payments are taken from those who already have repaid their debt.

The Student Loans Company release the figures following a Freedom of Information request by the BBC’s You and Yours programme.

Kevin O'Connor, head of repayment at the SLC, said: "Student loans are collected through the tax system, so by the time employers tell HMRC (HM Revenue and Customs), and HMRC tells the Student Loans Company how much of your loan you have paid through PAYE, you could have already paid more than you are due to.

‘The most efficient way to repay your loan as you approach full repayment is through the direct debit scheme for the last two years of your loan.

‘If you don't wish to pay by direct debit you can continue to pay through the tax system and be reimbursed when we receive the information from HMRC.’

Richard Lloyd, executive director of Which?, added: ‘It's outrageous that the Student Loans Company has again overcharged ex-students by millions of pounds.

‘The Student Loans Company has to stop this incompetence, fix their system and make sure everyone affected is fully compensated, fast.’

The figures released showed that around 15,000 extra graduates overpaid in 2009/10 than two years previously, with overpayment amounts steadily increasing until reaching £22.3 million last year.

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