Graduates in the UK have been refunded more than £107 million (€124 million) in the last 13 years by the Student Loans Company (SLC) after overpaying their student loans, figures released by the firm have revealed.

The situation arises when payments are mistakenly taken from those who have already fully repaid their loans.

The amount university leavers in England have been overpaying has steadily increased from £14,619 in 2000/1 to £22.3 million in 2009/10, the SLC said. Only 117 graduates overpaid in 2000/1, whereas 40,050 overpaid in 2009/10.

The figures were released by the SLC following a Freedom of Information request by BBC Radio 4’s You And Yours programme.

Kevin O’Connor, head of repayment at the SLC, said: “Student loans are collected through the tax system, so by the time employers tell HMRC (HM Revenue and Customs), and HMRC tells the Student Loans Company how much of your loan you have paid through PAYE, you could have already paid more than you are due to.

“The most efficient way to repay your loan as you approach full repayment is through the direct debit scheme for the last two years of your loan.

“If you don’t wish to pay by direct debit you can continue to pay through the tax system and be reimbursed when we receive the information from HMRC.

“Switching to direct debit means you can choose your monthly repayment date and we can make sure your repayments stop at exactly the right time.”

The figures also showed that there were almost 15,000 more graduates overpaying in 2009/10 than two years previously, with overpayment amounts steadily increasing from £15.9 million in 2007/8, to £18.9 million the following year and £22.3 million last year.

Software engineer Nicholas Lativy, 26, told the BBC he had overpaid by £4,000.

He said: “The amount that has been overpaid demonstrates that the system is broken.”

Since introducing the direct debit scheme in 2009, the SLC has contacted 106,000 customers to advise them that the direct debit option is available to them.

Since then, 34,000 customers have either taken up the direct debit scheme or paid their loans off in full.

There were 1.9 million students in 2000/1 compared with 2.5 million in 2009/10, according to the Higher Education Statistics Agency.

Richard Lloyd, executive director of consumer organisation Which?, said: “It’s outrageous that the Student Loans Company has again overcharged ex-students by millions of pounds.

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