Student Start-Up Loan for 2025: Higher education often comes with significant expenses, making financial assistance crucial for many students. To help ease this burden, Centrelink continues to offer the $1321 Student Start-Up Loan in 2025. This loan is specifically designed for students who are already receiving government financial support through Youth Allowance, Austudy, or ABSTUDY Living Allowance.
This loan provides essential funding for study-related costs such as textbooks, study materials, transportation, and technology. It is available twice a year, meaning students can access up to $2,642 annually if they apply for both loan periods. Unlike scholarships or grants, the Student Start-Up Loan is repayable, but it does not accumulate interest. Repayments begin only after the borrower’s income exceeds the government-set threshold.
Understanding how to apply, eligibility requirements, and repayment obligations is important before opting for this financial aid. This guide provides a detailed overview of the Centrelink Student Start-Up Loan, including key benefits, repayment conditions, and tips for responsible borrowing.
Overview of the Centrelink $1321 Student Start-Up Loan
| Category | Details |
| Loan Amount | $1,321 per loan period (twice a year) |
| Total Annual Amount | Up to $2,642 per year |
| Eligibility | Must receive Youth Allowance, Austudy, or ABSTUDY Living Allowance |
| Approved Courses | Must be enrolled in a higher education course (Bachelor’s degree, diploma, or advanced diploma) |
| Application Process | Apply via myGov Centrelink account |
| Repayment Threshold | Repayments start once income exceeds $51,550 per year |
| Loan Periods | First period: January 1 – June 30, Second period: July 1 – December 31 |
| Interest Rate | No interest, but indexed annually to inflation |
| Official Website | Services Australia (servicesaustralia.gov.au) |
Understanding the Student Start-Up Loan
The Student Start-Up Loan is a voluntary financial support program that assists students with the costs associated with their education. The loan can be used for various study-related expenses, including textbooks, laptops, transportation, and other essential academic tools.
This loan differs from traditional student loans because it does not accrue interest. However, the amount borrowed is indexed to inflation, meaning the total debt may increase slightly over time. The repayment process is income-based, and borrowers are only required to start paying back the loan once their earnings surpass a specific threshold.
Since this is not an automatic payment, students must apply for the loan for each loan period in which they wish to receive financial assistance.
Eligibility Criteria for the Student Start-Up Loan
To qualify for the $1321 Student Start-Up Loan, students must meet specific eligibility conditions:
1. Receive an Eligible Centrelink Payment
This loan is only available to students who are currently receiving one of the following government payments:
- Youth Allowance (for full-time students and apprentices)
- Austudy (for full-time students aged 25 and older)
- ABSTUDY Living Allowance (for Aboriginal and Torres Strait Islander students)
2. Be Enrolled in an Approved Higher Education Course
Applicants must be studying in an approved higher education course, such as:
- Bachelor’s degrees
- Diplomas and advanced diplomas
Vocational Education and Training (VET) courses do not qualify for this loan.
3. Hold a Valid Tax File Number (TFN)
A Tax File Number (TFN) is necessary, as all loan repayments are managed through the Australian Taxation Office (ATO). Without a TFN, applications cannot be processed.
4. Apply Within the Loan Period
Students must submit their applications within the designated loan periods:
- First loan period: January 1 – June 30
- Second loan period: July 1 – December 31
Applications must be submitted at least 35 days before the student’s course is completed to be eligible.
How to Apply for the Student Start-Up Loan
Applying for the Student Start-Up Loan is simple and can be completed online through myGov. Here’s a step-by-step guide:
Step 1: Log in to myGov
Visit my.gov.au and log into your account. If your Centrelink account is not linked, connect it before proceeding.
Step 2: Navigate to ‘Manage Payments’
After accessing your Centrelink services, go to the ‘Manage Payments’ section and look for the Student Start-Up Loan option.
Step 3: Complete the Application
Fill in the required details, including your Tax File Number (TFN) and confirmation of your enrolment in an approved course.
Step 4: Submit the Application
Once submitted, Centrelink will assess your eligibility. If approved, the funds will be deposited directly into your nominated bank account.
Repayment Terms and Conditions
The repayment process for the Student Start-Up Loan is different from standard personal loans:
- Repayments begin only when annual income exceeds $51,550 (as per the 2024-2025 threshold).
- No interest is charged, but the loan is indexed annually to reflect inflation.
- Automatic deductions are made from taxable income once earnings surpass the repayment threshold, similar to HELP debts.
- No penalties for early repayment, so borrowers can pay off the loan ahead of time if they wish.
Benefits and Considerations of the Student Start-Up Loan
Advantages
- No interest charges – The loan remains cost-effective compared to traditional student loans.
- Flexible repayment terms – Borrowers only repay when they earn above the threshold.
- Covers essential study costs – Helps students afford textbooks, technology, and other necessary expenses.
- No impact on other Centrelink payments – Receiving the loan does not affect eligibility for other student financial support.
Things to Consider
- The loan must be repaid – Unlike grants or scholarships, this is a repayable loan.
- Indexed to inflation – The total debt may slightly increase over time.
- Not automatic – Students must apply for each loan period separately.
Frequently Asked Questions (FAQs)
Can I receive the Student Start-Up Loan if I also have a HELP loan?
Yes, students with a HELP loan can still apply for the Student Start-Up Loan, as these are separate financial assistance programs.
Do I have to apply for the loan every semester?
Yes, this loan is not automatically renewed. Students must apply separately for each loan period to receive funds.
What happens if I withdraw from my course?
If a student withdraws from their course, they are still required to repay the loan. The loan amount will be added to their overall study debt and repaid through the ATO once their income meets the threshold.
Can international students apply for the Student Start-Up Loan?
No, this loan is only available to Australian citizens or permanent residents who receive an eligible Centrelink payment.
Is there a penalty for early repayment?
No, students can repay their loan early without penalties. This helps reduce the overall amount owed before indexation increases the debt.
Conclusion
The Centrelink $1321 Student Start-Up Loan is an essential financial resource for students needing additional support to manage their education expenses. With the option to apply twice a year, eligible students can access up to $2,642 annually to cover essential costs.
Since the loan is interest-free and repaid only after reaching a set income level, it provides a flexible financial solution for students without adding immediate financial strain. However, students should carefully assess their financial needs before applying and plan for future repayments.
For further details and application assistance, students can visit the Services Australia website or access their myGov Centrelink account.
