The long moratorium on student loans (which began in March 2020) is ending. Starting in October – just a couple days from now – people will have payments due on their student loans again. The data shows this will be a difficult transitionary period for some members or customers.
There is a total of $1.7 trillion of student loan debt in the US, and the Consumer Financial Protection Bureau says one in five borrowers are at risk of financial difficulties this fall. This is likely caused by an increase in other debts. CNBC reports 50% of those with student loans increased their credit card debt since the moratorium began.
What does all this mean for your bank or credit union strategic planning? Let’s touch on a few points.
Consumers need sound advice
Some members or customers may feel like they’re drowning this October, especially if they have other debts on top of their student loan payments. It’s difficult for these consumers to see their way out of the muck and toward financial security.
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