It won't make much difference seeing as the rate doubled in August and is currently standing at 4.9% or similar (can't remember the exact rate though). Did the NUS have any opinion on this or are they only going to pretend to do something when they think it would look bad if they didn't (to your average student who doesn't generally give a f*ck)?
More worrying, perhaps, is the personal information... does this mean that whereas previously information about the amount owed by students was not shared with credit agencies, and therfore not affecting your credit rating... now will be shared? Are students going to be bombarded with junk mail offering a more competitive rate than their student loan, with discounted rates for the first year, more cashback deals and all the cons attached?
When the NUS are saying this... "Our primary concern is that individual borrowers - students and graduates - who have received loans, will not be affected by these proposals through changes in terms and conditions or increased interest rates"...
I think the government is just leaving the actual money lending to the third partys. Although I do wonder why they have decided to do this. No third party lending company would go into this scheme without having financial reasons behind it, which cannot bode well for future students.
No company would enter into this unless they had a clear, achievable plan for getting more out than they put in. If the Government is not going to find this "extra" for the purchasing company, there is only one place it could come from - the students. And would the personal info include details of your salary (since you pay back a minimum of 9% of what you earn over ?15k)?
Presumably data protection laws would stop them doing anything dodgy with personal information. They're only allowed to use it for the purpose with which it was collected, i.e. administering student loans, so any other usage would be illegal.
Ms Tumelty seems to misunderstand the situation. Selling off debt is only a bad idea when you're selling debt that is unlikely to ever get paid back. Student debt is not really in that category.
You do have to wonder though quite how a private company will make money from debt where the rate is pegged to inflation. Unless the government plans to raise the rates, the plan is nonsensical.