Analysis · The Telegraph · 7 July 2026
Student loans mis-sold to five million people, say MPs: What It Means for Your Student Loan
Written by Zubair Arshed FIA, Chartered Actuary
Fellow of the Institute and Faculty of Actuaries
Actuarial Post Life and Health Actuary of the Year 2024
MPs have reportedly claimed that student loans were mis-sold to around five million people, a striking framing for a system most of us treat as fixed and unchangeable. If you borrowed for an English degree, the word mis-sold raises an obvious question: does anything actually change for what you repay each month? The short answer is that political noise and your legal repayment terms are two different things, and it pays to understand the gap.
This analysis responds to reporting by The Telegraph. We recommend reading the original alongside it: Student loans mis-sold to five million people, say MPs ↗
What did the MPs actually say?
Based on the headline, MPs have described student loans as having been mis-sold to roughly five million people. That figure points squarely at the Plan 2 cohort in England, the people who started courses from 2012 onwards under the higher fees and the higher repayment threshold. Mis-sold is a loaded term borrowed from financial services, where it means a product was sold with misleading information or without proper explanation of its risks.
In the student loan context, the grievance usually rests on a few things. Borrowers took loans expecting one set of terms, then found the government changing those terms afterwards. The repayment threshold was frozen rather than rising with earnings. Interest was charged at RPI plus up to three percent while balances grew faster than many could repay. The label of a loan, rather than the reality of something closer to a graduate tax, was arguably never made clear at the point of signing.