Gov't Extends Interest Rate Freeze to Student Loans

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Hungary's government has decided to extend an interest rate freeze to free-purpose student loans, keeping the rate for the credit at 4.99% from January, Economic Development Minister Márton Nagy said in a video message on the government's Facebook page on Tuesday, according to a report by state news wire MTI.

"The Hungarian government cannot allow students to pay the price of failed sanctions and take away the chance for thousands of young Hungarians to continue their studies," Nagy said.

If the government took no measures, the rate for the free-purpose student loans would have to be raised over 10%, putting more than 100,000 people in a tough spot, he added.

He noted that close to half a million Hungarians have taken out student loans and around half of those have been awarded diplomas.

"Everything must be done to allow those who want to, and are able, to study. We must protect our young people!" he said.

He added that student loans to cover tuition will remain interest-free.

The government earlier froze interest rates for retail mortgages and SME credit amid tightening monetary policy conditions.

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