SLC disbursements, refunds and repayments.
Let us take the confusion out of student loans for you. Here’s what you need to know about the SLC and disbursements before you head off to college or university.
In this article:
- What is SLC?
- SLC Disbursement meaning
- SLC responsibilities for undergrads in the UK
- SLC maintenance loans versus tuition fee loans
- When Are SLC Disbursements Paid?
- How Are SLC Disbursements in the UK Paid?
- How do loan repayments work?
- SLC Disbursements Payment Refunds
Before you head off to uni, it’s worth knowing a few important things about student finance. Firstly, about your tuition fees and your living expenses at university, and secondly about how the loan is paid to you.
A good place to start is a brief overview of the SLC…
What is SLC?
SLC stands for the Student Loans Company. The SLC is where you can expect your student loans to come from – both maintenance and tuition loans. When your student loans land in your account, you’ll see the payment labelled as ‘SLC Disbursements’ or similar.
SLC Disbursements is the term that’s used for your loans being paid out to you.
The SLC administers student funding on behalf of the Department for Education, having been set up in 1989 to manage the student loan system in the UK – including bursary payments on behalf of many UK Higher Education providers.
SLC disbursement meaning
Disbursement means paying out money from a fund. In this case, the Student Loans Company is disbursing money from a fund to UK students who have enrolled in university. The SLC is funded by the UK Government, and its function is to pay loans to students. The SLC’s role is as a non-profit making, government-owned organisation that administers loans and grants to students in colleges and universities in the UK.
The SLC is also responsible for collecting student loan repayments, which you can find more about on our blog, as well as a brief overview further down in this article.
SLC responsibilities for undergrads in the UK
If you’re a student in England and Wales then your loan eligibility will be processed by Student Finance England (SFE) and Student Finance Wales in partnership with the SLC.
If you’re a student from Scotland, the Student Awards Agency Scotland (SAAS) will assess your student finance applications and review how much you’ll get for the academic year. Your payments themselves will come from the SLC.
The Student Loans Company’s responsibilities include managing the full end-to-end ‘apply, assess, pay and repay’ process for undergraduates in England and Wales. The SLC provides the payment and repayment parts of this service for Scotland and Northern Ireland, as well as maintaining the assessment systems and online application portals used in Northern Ireland.
SLC maintenance loans versus tuition fee loans
You’ll get two types of loans from the SLC: maintenance loans and tuition fee loans. Tuition fee loans are given to cover the cost of your uni tuition as charged by your university for your course(s). Your tuition fee loans from the Student Loans Company are paid directly to your university so you won’t see this money enter your bank account.
Maintenance loans, on the other hand, will go into your account to help support you during your time in higher education. For most UK students, the maintenance loan will be the biggest source of income while at uni. It should cover your accommodation and living expenses like food, travel and courses necessities.
Unlike tuition fees, which are fixed, maintenance loans are mainly dependent on your household income – usually based on your parent(s) income and other factors like where you’ll live during your course.
When Are SLC Disbursements Paid?
SLC disbursements of your maintenance loan will be paid to you once a term (roughly), if you’re studying in England, Wales or Northern Ireland – with the total for each academic year split into three equal instalments and paid directly into your bank account. In Scotland, SAAS student loan payments are paid monthly, rather than in three equal instalments like the rest of the UK.
You should receive a payment at the start of each term, with the intention being to allow students to learn more financial responsibility rather than getting a large lump sum at the start of the year.,
The exact date that your student finance disbursement from SLC will depend on your course and your uni. Generally speaking, though, you can expect your student finance payment to come in around end of September/start of October.
Another SLC payment will hit your account at the start of January and the last will be in April. To track the exact dates, log into your Student Finance account to see the schedule.
How Are SLC Disbursements in the UK Paid?
Tuition fees in the UK are paid directly to your uni, while your maintenance loan goes straight to your bank account.
SLC can take up to three weeks after an application has been submitted for funds actually to arrive in a student’s bank account so it’s really important to apply for your loan as soon as possible in order to receive the funds on time or you might be left in lurch in the meantime.
How do SLC loan repayments work?
You’ll have to repay your student loan once you’ve graduated from university, however, you won’t have to start paying it back until you’re earning more than the payment threshold of £27,295 per year (on plan 2).
This equates to earning £2,274 a month or £524 a week in the UK. If your income falls below the repayment threshold, your repayments will stop and only restart when your income is over the threshold again. You can also make additional voluntary repayments to SLC at any time.
You’ll repay 9% of your income over the repayment threshold, but if your income changes then your repayment amounts will automatically change to reflect this. After you graduate you have 30 years to pay back your student loan. After this, the remaining balance will be written off (woooo!)
The amount of money that you’re going to owe will depend on the type of loan that you took out, but all student loans are subject to interest. Repayments can be made via a direct debit or standing order, but if you fail to set these up on time then you’re likely to be subjected to late fees.
SLC Disbursements Payment Refunds
In 2020, as part of ongoing improvements to the repayment service, the Student Loans Company (SLC) began trialling automatic bank refunds to customers who over-repaid on their student loans in the UK. That means if your student loan accounts are in credit, you may receive a refund. SLC refunds are paid directly into customers’ bank accounts and show as ‘SLC Receipts’ on bank statements.
There are several situations where you can ask for a refund. We’ve listed a few below:
- Your income was below the threshold for repayment
- You started making payments before you needed to
- You’ve overpaid by mistake or because you were placed on the wrong repayment plan by your employer
If you’ve overpaid and the Student Loans Company hasn’t contacted you, you can reach out to them and ask for a refund.