Gateshead graduate described student loan system as a ‘scam’

Reef Pearson, 27, graduated from the University of Birmingham in 2019 with a business and communications degree after covering her studies with plan 2 tuition fee and maintenance loans.

Originally from Gateshead, Reef now works in Ancoats, Manchester. She received her first statement from Student Finance England the year after graduating, showing she owed £50,807.59.

Reef Pearson, 27, graduated from University of Birmingham with a business and communications degree in 2019 (Image: Reef Pearson / SWNS)

After spending several years working minimum wage jobs, she secured a £40,000 a year role as an SEO manager in October 2023 and began repaying her student loan in 2024.

However, despite paying around £2,000 a year towards the balance, interest added to the loan means the total amount she owes has continued to increase.

In 2024, Reef paid £1,647 towards her loan but £3,967.71 was added in interest. In 2025, she repaid £1,963 while £4,270 was added to the balance.

A graduate with £60k of plan 2 student loan debt says each year she pays £2k off – to see it rise by £2k. (Image: Reef Pearson / SWNS)

Reef said: “When I looked through my statements, I thought ‘God, is that even right?’.

“It’s so insulting to log in, see you’re paying it off, but at a rate that doesn’t even see the figure go down.

“And I’m aware I’m on a decent wage. If this is happening to me, what on earth is happening with other people?”

Despite Reef having a £40k a year job she is still struggling to pay the loan off (Image: Reef Pearson / SWNS)

She said reviewing the figures left her questioning the system, Reef said: “Looking back, it feels like a scam. The whole concept of young people being told by the government that this is the way into education – and find out later they charge you double interest.

“It feels like I’m throwing money into an abyss. It’s just diabolical.”

Graduate Reef Pearson has said the student loan system ‘feels like a scam’ (Image: Reef Pearson / SWNS)

She said she had spoken to her younger siblings about her experience.

Reef said: “I have a younger brother and sister, and I sat them down and told them that they should consider other options than university.”

Reef said she did not particularly enjoy her time at university but continued with the degree because she believed it was needed to work in marketing.

She also said the message many students received at sixth form was that the debt would eventually be written off.

Reef said: “It’s fine, your debt will be wiped after 30 years. That sounds quite nice, but the reality now is very different.”

Reef Pearson from Gateshead has saw her student loan increase by 2k every year in interest (Image: Reef Pearson / SWNS)

After starting her current job, Reef reached the repayment threshold and now pays between £100 and £200 a month towards the loan.

Reef said: “What may sound like a good salary doesn’t get you very far, not as a single woman living alone. That £100 or £200 a month could help a lot.”

Although she now enjoys her job, she believes the terms of the loan were not fully understood when she signed up as a teenager.

Reef secured her first big-time job as a SEO manager in October 2023 and began paying off her loan from 2024 onwards. (Image: Reef Pearson / SWNS)

Reef said: “At 18, anything that has that kind of government stamp on it, you have trust in it, you think they’ll give you a good deal.

“It never crossed my mind there would be an interest rate like this.

“It’s hard to comprehend, I didn’t realise the government had these bleak terms, even for something private – never mind public sector.”