Good news, students! It looks like student loan interest in Canada will be scrapped for good, according to the latest fiscal update from the federal government on Thursday.
Back in the early days of the pandemic, the Canadian government announced that interest payments on Canada Student Loans and Canada Apprentice Loans would be waived for two years.
However, the feds say that no student should have to second-guess their higher education plans because of the financial burden.
That’s why they plan to extend the interest freeze past March 2023, when this current two-year period is set to expire, including interest on loans currently being paid back.
The decision must still be given Royal Assent before it becomes permanent.
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#FES2022 proposes to eliminate interest on all Canada Student Loans and Canada Apprentice Loans beginning on April 1, 2023, saving the average student loan borrower $410 per year to make education more accessible for all Canadians.
Learn more: https://t.co/9hpjdHJ40l pic.twitter.com/ML0jhLfy9L
— Finance Canada (@FinanceCanada) November 3, 2022
According to the government, this decision will save over 1 million students an average of $410 per year, and “save an average borrower more than $3,000 over the lifetime of their loan.”
It’s worth noting that this interest freeze won’t apply at the provincial level, so you will still have to pay the interest on the provincial portion of your student loan.
However, some provinces are choosing to follow in Canada’s footsteps by getting rid of their student loan interest.
New Brunswick just announced that it will eliminate interest on the provincial portion of its student loans as of November 1st, 2022. However, interest accrued before this date remains payable.
There are also a number of other supports for students all over Canada, according to the National Student Loans Service Centre.
A new update to the Repayment Assistance Plan is now in effect in Manitoba, Newfoundland and Labrador, Saskatchewan, and New Brunswick, which goes into effect this month.
The government also recently announced a number of benefits that Canadians are now eligible for to help offset the costs of everyday life.
