New Zealanders Owe $16.19 B In Student Loans – Overseas Borrowers Account For $4.34 B But Only 23.6% Are Repaying

1 January 2026

• New MoneyHub Analysis Reveals Stark Divide Between Domestic and Overseas Student Loan Compliance

New Zealand’s student loan scheme has a total outstanding balance of $16.19 billion owed by 618,798 borrowers, according to new analysis of the latest Inland Revenue (IRD) data by personal finance research website MoneyHub. While domestic compliance remains strong at 95.4%, only 23.6% of the 114,060 overseas-based borrowers are meeting their repayment obligations, with $2.39 billion now overdue from this group alone.

“The data shows two very different systems operating under the same scheme,” said Christopher Walsh, Founder of MoneyHub:

“Automatic PAYE deductions make the domestic side highly effective, but overseas borrowers face no such mechanism, and the result is a growing pool of debt that is increasingly unlikely to be recovered. Taxpayers ultimately bear the cost of loans that are not repaid.”

Key findings from the analysis include:

• Total borrowers: 618,798 – down 15% from the late-2010s peak
• Total student loan balance: $16.19 billion (stable around $16 billion for the past five years)
• Median loan balance: $17,529 – up 31% since 2013
• New Zealand-based borrowers: 504,738 (82%) owing $11.85 billion, with 95.4% compliance
• Overseas-based borrowers: 114,060 (18%) owing $4.34 billion, with only 23.6% compliance
• Total overdue debt: $2.57 billion – 93% ($2.39 billion) owed by overseas borrowers
• Approximately $1.15 billion of overdue debt is penalties and interest, nearly half of the overseas overdue total

The Overseas Borrower Challenge

Overseas borrowers represent just 18% of all borrowers but hold 27% of total debt and 93% of overdue amounts. The average overseas borrower owes around $38,000 – 62% more than the average New Zealand-based borrower ($23,500). Overseas compliance has roughly halved since the early 2010s, while the balance owed by this group has grown 48% over the same period, driven by compounding interest and low repayment rates.

“Without automatic deductions and with interest accruing at around 5%, many overseas debts grow faster than they are repaid,” Walsh said. “Enforcement across borders is difficult, and the data reflects that reality.”

Domestic System Remains Robust

In contrast, New Zealand-based borrowers benefit from automatic employer deductions through PAYE, delivering consistently high compliance. Annual repayments total around $1.6 billion, with roughly two-thirds coming via employer deductions.

Long-Term Trends

Borrower numbers have fallen steadily as older loans are cleared, but total debt has remained flat due to new borrowing and overseas interest accrual. Median balances have risen 31% since 2013, reflecting higher course fees and living costs despite past policies like fees-free first-year tertiary study.

The full analysis, including historical tables, compliance trends, repayment breakdowns, and charts, is available in MoneyHub’s guide New Zealand Student Loan Statistics 2025.

*Data Source Inland Revenue (IRD) Student Loan Scheme quarterly statistics (latest release covers quarter ending September 2025, published late 2025). All figures relate solely to the government-administered Student Loan Scheme and exclude private education loans.

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