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Interest is added to overseas based customers' student loans.
Interest is calculated daily and added to your loan balance at the end of the tax year.

Interest is added to overseas based customers student loans. Interest is calculated each day on your loan balance using the current interest rate. Interest is always included in your loan balance, but interest is only charged on this interest after 31 March each year.

If you are a New Zealand-based customer, you are entitled to an interest free student loan.

If you go overseas your loan stops being interest free, but there are some exceptions to this.

The interest rate is set at the start of each tax year, 1 April. It is currently 3%.

What happens to my student loan when I go overseas

Late payment interest

If you do not make your payments on time, we may charge late payment interest. 

This is only charged on the overdue amount, and only if the overdue amount is more than $334. It will keep being charged until you have caught up with your payments.

The late payment interest rate is currently 7%. This is calculated as a monthly rate of 0.565%. The standard interest rate applies to the rest of your loan.

Reduced late payment interest rates

If you contact us about late payments on your student loan, we may be able to reduce the amount of late payment interest you need to pay.

You can arrange an instalment plan to pay off your late payment amount. If you stick to the plan we can switch you to the reduced late payment rate so you pay less interest.

The reduced late payment interest rate is currently 5%. This is calculated as a monthly rate of 0.407%.

Pay using instalments

Administration fees

If your student loan balance is $20 or more at 31 March we will charge a $40 administration fee. This is to cover the costs of managing your loan. You will not be charged an administration fee in the same year that you have been charged an establishment fee.

Last updated: 01 Apr 2021
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