Biden cancels another $4.2bn in US student loans before leaving office 

US President Joe Biden’s administration is cancelling student loans for another 55,000 people in the United States, amounting to $4.2bn in debt forgiveness just weeks before his time in office ends.

The White House said in a statement on Friday that the move would affect public service workers, including teachers, nurses and law enforcement officers.

It brings the total number of Americans approved for student debt relief during Biden’s tenure as president to nearly five million.

“Because of our actions, millions of people across the country now have the breathing room to start businesses, save for retirement, and pursue life plans they had to put on hold because of the burden of student loan debt,” the White House said.

In a separate statement, the Department of Education said the Biden administration had forgiven a total of about $180bn in student loans.

Friday’s announcement is expected to be the final round of public service loan forgiveness before Biden leaves office in January.

The Democratic president had unveiled a landmark forgiveness programme in 2022 to cancel hundreds of billions of dollars in student debt.

The plan would have made certain borrowers eligible to receive $20,000 in cancellations while the vast majority were eligible for $10,000.

But the conservative-majority Supreme Court overruled the programme last year, stating that given the large sum, the president had overstepped his powers.

Biden promised to fight the ruling and, since then, he has focused on expanding loan relief through targeted programmes.

Under Biden, the Education Department loosened the rules for public service loan forgiveness, which previously had a 99 percent rejection rate amid burdensome rules and widespread confusion over eligibility requirements.

In the US, colleges can often cost anywhere between $10,000 and $70,000 a year, leaving some graduates with crushing debt as they enter the workforce.

According to the Pew Research Center, one in four American adults under the age of 40 have student loan debt with the median amount owed being $20,000 to $25,000 in 2023, varying by education level.