The error impacted about 4,000 students who have Advanced Learner Loans which are paid to people who want to go to university but do not have the right qualifications, and cover the costs of a course at a college or training provider.
Calls are now being made for urgent improvements to the SLC’s loan processing systems.
She took out a £2,395 Advanced Learner Loan in July 2013 to fund a one-year access to higher education diploma in health at Stoke-on-Trent College. This qualification allowed her to progress to a midwifery degree at Keele University.
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Ms Bradbury repeatedly contacted the SLC, and despite assurances that the loan would be written off automatically, she continued to receive correspondence stating that it had not been cleared.
The Ombudsman found the SLC had failed to process the loan write-off correctly and had not transferred the outstanding balance from Jennie’s Advanced Learner Loan to her graduate loan account.
The PHSO recommended that the SLC issue a formal apology, outline a clear communication plan for affected students, and provide Jennie with an additional £200 in compensation, which the SLC has now done.
Rebecca Hilsenrath KC of the PHSO said: “Thousands of students have been affected by this and have been paying off a loan which should have been written off. The problem was exacerbated by the fact that no one listened, and no one did anything.”
In the UK, student loans are typically divided into different plans, with repayments kicking in once a graduate earns above a set income threshold.
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A spokesperson for SLC said: “All eligible Advanced Learner Loans balances have been written off and no customer has been financially disadvantaged as a result of this issue. We apologise to any customer affected and have confirmed this approach to the PHSO. SLC has taken steps to ensure this issue cannot happen again.”
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