Beware student loan overpayments

Money Box

BBC

Business

4.2 • 825 Ratings

🗓️ 2 September 2017

⏱️ 25 minutes

🔗️ Recording | iTunes | RSS

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Summary

More than 90,000 graduates were refunded hundreds of pounds last year after HMRC took payments for their student loan even though they had paid it off. Money Box has discovered these overpayments are routinely taken for many months because HMRC fails to communicate properly with the Student Loans Company. The programme hears from graduates who've experienced this and from tax expert Graham Farquhar at RSM.

The UK's biggest doorstep lender is in trouble. Shares in Provident Financial plummeted 65% at the end of August. They have recovered slightly but now the company has issued another profit warning after trying to modernise its business and save costs. Doorstep lending began over a hundred years ago. Local agents arrange loans in customers' homes and collect repayments weekly. The sums involved are often small. But the interest charged is very high - more than 500% on a six month loan. A former Provident Financial Agent Ian sheds light on how the business of doorstep lending works. And Peter Tutton from the debt charity Stepchange outlines his concerns.

Big changes are coming in the way that investment funds treat their clients. From January they will have to bill customers separately for the cost of research - at the moment it is bundled into the annual charges. Some funds - like the US mutual Vanguard - have said they will absorb all research costs. That could bring charges down. But there are other changes all being brought in under a European Directive that could put charges up. Louise Oliver, Chartered Wealth Manager and Director of Piercefield Oliver and Gina Miller, Director of fund manager SCM Direct, debate the issues.

Transcript

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0:00.0	You're about to listen to a BBC podcast, but this is about something else you might enjoy.
0:05.4	My name's Katie Lecky and I'm an assistant commissioner for on demand music on BBC Sounds.
0:10.8	The BBC has an incredible musical heritage and culture and as a music lover, I love being part of that.
0:17.5	With music on sounds, we offer collections and mixes for everything, from workouts to
0:22.4	helping you nod off, boogie in your kitchen, or even just a moment of calm. And they're all put
0:28.3	together by people who know their stuff. So if you want some expertly curated music in your life,
0:35.0	check out BBC Sounds. Thank you for downloading this edition of Moneybox.
0:39.3	I'm Josephine Cassely and I'm the programme reporter this week.
0:42.3	Our main story arose from a freedom of information request I made to the student loans company.
0:47.3	Their response was very interesting indeed and will be of concern to the millions of graduates
0:52.3	now paying off their student loans. I hope you enjoy it.
0:56.1	Hello, another Museum of Curiosity here in today's programme.
0:59.4	Why does the student loans company let the vast majority of graduates overpay at the end of their student loan
1:05.8	and then make them claim the money back?
1:08.6	Here's one graduate's view.
1:10.4	It's just a mess. It's just absolute chaos
1:12.8	and no one knows what's going on. Very difficult and very confusing, I'd sum it up.
1:17.6	The UK's biggest doorstep lender has seen its share price crash after making changes in the way
1:22.8	it operates. We find out how home credit works. And new rules will make investment funds reveal the true cost of their research,
1:30.6	but will other changes make it more expensive to invest?
1:34.9	But first, more than 90,000 graduates were refunded hundreds of pounds each last year
1:40.0	because HM revenue and customs continued to take repayments for their student loan long after they'd paid it off.
	...

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