Cabinet cancels planned interest cap on student loans, which turns out to be many times more expensive than expected

The Dutch government has abandoned its plan to cap student loan interest rates at 2.5%, as costs are significantly higher than expected. Education Minister Rianne Letschert announced this in a letter to Parliament, citing rising long-term interest rates due to geopolitical tensions. The initial budget of 40 million euros was deemed insufficient, with the actual cost of the cap estimated at 160 million euros annually. Alternatives proposed include a fixed interest discount or a complex moving cap. The Landelijke Studentenvakbond expressed disappointment over the decision, fearing further interest rate increases for students.