I would like to ask you about postgraduate student loans. I am a student from the EU and would like to apply for postgraduate student loan for studies in the UK since September 2016. But I do not understand exactly details of the interest rate. In Terms and Conditions I read that current interest rate is approximately 3,9%. I understand that 3% are ‘fixed amount’ and 0,9% are Retail Price Index. So far it is clear, but I do not understand system of interest calculation. Are 3,9% interest per year (per annum)? It would mean that if I for example had 7.000 GBP loan, I would own after first year 7273 GBP (7 000 * 1,039), after second year 7556,6 GBP (7273 * 1,039), in 2018 it would rise to 7851,4 GBP etc.
Or is the loan interested just once (not during years)?
Thank you very much,
What are your thoughts?