Amount of the student loan compensation

The student loan compensation is equal to 40 percent of the amount of outstanding student debt exceeding EUR 2,500. This means that you must have taken out more than EUR 2,500 in student loans to qualify for a compensation.

There is a maximum limit to the amount of student loan compensation you can get. You can also take out a higher amount of student loan per month or per academic year than the amount taken into account for the student loan compensation. In such a case, you will receive compensation for the maximum amount of student loan taken into account, but not for the exceeding amount.

You will receive a compensation for the student loans you have taken out during higher education studies begun on or after 1 August 2014. Interest payments added to the principal amount of the loan are not counted as part of the loan. If you have student debt for earlier secondary-level studies, that debt is also not included.

If you make repayments on your loan while you are still a student, that will reduce your student loan compensation. This means that it is not in your interest to start paying back your student loan until the end of the term in which you graduate.

Use this calculator to estimate how large your student loan compensation would be (in Finnish).

Maximum amount

The student loan compensation has a maximum amount based on the extent of the study programme.

Extent of the degree programme in credits Maximum amount of loan recognised, EUR Maximum student loan compensation, EUR
Bachelor's + master's level university degree, or master's level university degree exclusively, completed in Finland
300 18,000 6,200
330 20,000 7,000
360 21,600 7,640
Extent of the degree programme in credits Maximum amount of loan recognised, EUR Maximum student loan compensation, EUR
Degree earned in a university of applied sciences degree or bachelor's level university degree, completed in Finland
180 10,800 3,320
210 12,800 4,120
240 14,400 4,760
270 16,400 5,560

If you earn a higher-education degree outside Finland, the maximum student loan compensation is larger. If you complete a master's degree outside Finland where the standard time to degree is 5 years,

  • the maximum amount of loan recognised is EUR 31,500 and
  • the maximum student loan compensation is EUR 11,600.

The maximum amount of the student loan compensation is calculated so that nine months' worth of loan is recognised for each academic year and five months are recognised for each term. The amounts of student loan debt taken into account when calculating the compensation are

  • EUR 400 per month for degrees completed in a Finnish institution of higher education
  • EUR 700 per month for degrees completed in a foreign institution of higher education.

However, the amounts of the instalments of student loan that you take out or when you take out the instalments are not significant. We take into account all student loans taken out during the higher education studies in full, but as regards the total amount only up to the maximum amount of student loan.

Example

A student of a university of applied sciences completes a 210-credit degree programme in the target time. She has EUR 16,020 in student debt at the end of the term in which she graduates. Loans taken out to finance secondary studies preceding the higher education studies (EUR 4,400 in total) and the interest payments capitalised, i.e., added to the principal amount of the loan (EUR 440), are deducted from EUR 16,020. The amount of student loans taken out during the higher education studies is EUR 11,180.

The amount of loan per degree corresponding to the target time to degree (3.5 academic years) is (3.0 acad. yrs x 9 mths/acad.yr + 5 mths) x EUR 400 per month = EUR 12,800. The student loan compensation is calculated on the basis of the student's actual loan amount because it is smaller. The compensation comes to (11,180 - 2,500) x 40% = EUR 3,472.

Payment

Kela usually pays the student loan compensation directly to the bank, which means that it pays back your loan by an amount corresponding to the compensation.

The compensation can be paid differently in the following situations:

  • If Kela has repaid your student loans to the bank in its capacity as the loan guarantor, the student loan compensation will first be applied towards the student loan which is being collected by Kela.
  • If you have student debt with several banks or on several promissory notes, the student loan compensation will be applied towards the loan with the largest principal amount.
  • If you have student debt which is being collected by Kela and you have paid back all of your student loans held by banks, Kela pays the student loan compensation to you personally.

Keep in mind that it is not in your interest to pay off a student loan before the last day of the term in which you graduate (31 July or 31 December).

Taxation

The student loan compensation is not subject to tax.