Korea Student Aid Foundation Opens Applications for First Semester Student Loans This Year... Loan Interest Rate Frozen at 1.7% for 5 Consecutive Years

The Ministry of Education (Deputy Prime Minister and Minister of Education Lee Ju-ho) and the Korea Student Aid Foundation (Chairman Bae Byung-il) will begin accepting applications for student loans for the first semester of the 2025 academic year starting from the 3rd.

Applications for student loans can be made using the student's own electronic signature method through the Korea Student Aid Foundation website or mobile app. Tuition loans can be applied for until April 24, and living expense loans until May 20.

Korea Student Aid Foundation

Students who need student loans should apply at least 8 weeks before their university’s registration deadline, considering the approximately 8-week period required for the assessment and notification of the student aid eligibility, to ensure stable loan approval.

The interest rate for student loans in the first semester of the 2025 academic year will be frozen at 1.7% for the fifth consecutive year to reduce the repayment burden on youth, despite the pressure of rising funding costs amid difficult economic conditions.

Maintaining this low-interest policy means that student loans can be used at about 40% of the average household loan interest rate from commercial banks (4.38%), which is expected to significantly reduce the repayment burden.

The repayment income threshold, which is the mandatory repayment criterion for income-contingent student loans, has also been raised to reduce the repayment burden on low-income young workers.

Reflecting increases in the median income and minimum wage, the 2025 threshold has been raised by 1.72 million KRW (+6.42%) from 26.79 million KRW (17.52 million KRW after deductions) in 2024 to 28.51 million KRW (18.98 million KRW after deductions).

This increase is the largest in the past five years and is expected to lower the mandatory repayment burden for low-wage young workers.

Bae Byung-il, Chairman of the Korea Student Aid Foundation, stated, “Amid difficult economic conditions, the government’s active financial support has allowed us to freeze the loan interest rate at a low 1.7% for five consecutive years to ease the repayment burden on youth.” He added, “We will continue to actively support students to use as much as they need by supplying low-interest student loans in cooperation with related ministries.”