Demand for student loans in Germany has plummeted significantly over the past decade, according to a new study by the CHE Centre for Higher Education Development. The study, reported by Handelsblatt, reveals a dramatic decline in new loan approvals, dropping from nearly 60,000 in 2014 to just under 13,000 in 2024.
Ulrich Müller, a CHE managing director, highlighted that new loans from KfW, the state-owned market leader, are approaching zero. He attributed this sharp decrease primarily to perceived “unattractive conditions” particularly the current interest rate of 6.3 percent.
The German government, as outlined in its coalition agreement, aims to address this issue by pushing for “fair conditions” and exploring options for loans with fixed interest rates. However, the timeline for implementing these changes remains unclear, with a formal response from the office of Research Minister Dorothee Bär (CSU) pending.
CHE’s findings suggest a significant impact on students, with Ulrich Müller stating that private providers are only able to partially fill the gap left by KfW. “Numerous students are left disadvantaged” he said. “KfW is effectively leaving them in the lurch, which threatens to force students into part-time jobs, prolong their studies and, in worst-case scenarios, lead to study abandonment”.
