Holy help: Student loan index set to triple

Student loan index is set to increase by 550% on June 1

23 May 2022

  • New student loan index set to increase to 3.9% from 0.6% in 2021
  • Last time the index was 3.09% was in 2009
  • Average HELP debt is $23,280 
  • Annual index on a $23,280 HELP debt will increase from by $768
  • 2.9 million people have HELP debts
  • It takes 9.4 year on average to repay a HELP debt


New analysis from Mozo shows that students will be hit with a higher index rate on their HELP debt due to high inflation. The student loan index, which is applied to all government assisted study loans, will increase 550% from 0.6% to 3.9% on June 1. 

The index that is applied to all student loans is calculated based on the March Consumer Price Index (CPI). This year CPI rose 2.9% to 5.1%, the average HELP debt of $23,280 will see a $768 increase to the indexed amount.  This year $908 will be added to the HELP balance, which is a significant increase from the $140 that would have applied last year, excluding compulsory repayments. 

“HELP debt, previously known as HECS debt, is a great initiative that helps most students in Australia contribute to the cost of their higher education. These loans are not charged interest like a typical loan, but are charged an index each year, on the owing balance,” says Claire Frawley, Mozo Spokesperson.

Almost 3 million Australians have a HELP debt and the Australian Taxation Office estimated it takes 9.4 years on average to repay a student loan. 

“While most workers are prepared to start paying off their debt once they start earning above the salary threshold of $46,620, some people might not realise their debt growing in size due to the yearly index applied.”

The last time the student loan index was 3.9% was in 2009, when CPI was 2.4%.

“Much like interest on a loan, the student loan index is unavoidable when repaying student debt. If you are in the position to pay off some of your loan, it would be wise to make those voluntary repayments before 1 June, so that your total loan debt amount decreases by the time the new index is applied,” says Frawley. 


Student loan index increase was sourced from the Higher Education Support Act. Average student loan amount was sourced from the ATO and APH.  The median graduate salary is $60,000, according to The Quality Indicators for Learning and Teaching (QILT) survey of more than 120,000 students conducted in 2020.