Figure 1: Poster used to invite new participants for the survey (QR code included; survey now closed).

Abstract

 

This study looks at the effect that interest-based student loans have had on the educational and career decisions of British Muslim students aged 16-25. Using a mixed-methods approach, the initial survey gathered 143 respondents with 15 of them participating in a follow-up interview. The study's overall trend indicates that the interest element within the loan is a decisive factor in influencing the educational and career decisions of British Muslim students, with many considering alternatives such as apprenticeships and alternative sources of funding. The interviews further supported this, with many highlighting the challenges they faced even when considering such alternatives to fulfil their aspirations. The findings of this study underline the need for an accessible alternative for British Muslim students, one which is sustainable and open to all.

Background and Context

 

This project started on Friday 8th August 2025 by Muttee Mirza, seeking to understand the impact that interest-based student loans have had on the educational and career pathways of British Muslim students across the United Kingdom. This was inspired by his own experience, taking a gap year having avoided university due to the student loan.

 

It is important to understand that the student loans used to finance university tuition fees in the United Kingdom contain interest, which Muslims are prohibited from engaging with. Each year, many Muslims miss out on university due to the interest component and as a result cannot pursue their career aspirations. Others are forced to take the loan against their own desires despite personal beliefs. There have been studies focusing on statistics with most recently a study from The Muslim Census in 2021, which found that 1 in 10 qualifying Muslim students were deterred from going to university due to the student finance concerns. However, there is no study which examines the qualitative side exploring the personal impacts in-depth.

 

This project fills in that gap by giving Muslim youngsters the platform to share their experiences, aiming to present a solid case to the UK government to advocate for the swift establishment of an Alternative Student Finance (ASF), enabling both Muslims and non-Muslims to access student loans with ease. Moreover, this project aims to be a beacon of hope for many Muslims both in the United Kingdom and the West, showing that it is possible to pursue aspirations without compromising on your beliefs.

Methodology

 

This study adopted a mixed-methods approach, combining both quantitative and qualitative research to obtain comprehensive results.

 

The quantitative measure used was a survey questionnaire, which collected initial responses from survey participants across the United Kingdom. The qualitative measure involved one-to-one interviews with participants who had voluntarily opted in through the survey. These interviews explored the individual experiences of participants in greater depth, providing key insight and justification for the original findings.

 

Percentages shown in the results were rounded to the nearest whole number for clarity and consistency.

 

All participants were anonymised, except those who took part in interviews and explicitly consented to being named and/or attributed to specific characteristics. All materials associated with the study were stored in a GDPR-compliant encrypted cloud service. The applications used for interviews and booking were GDPR-compliant. Upon completion of the study, all contact details were permanently deleted in accordance with GDPR requirements except those who wished to be informed about post-study opportunities, such as participating in a potential mini-documentary about the study.

Study findings

 

The survey started off by asking participants about university attendance. Out of the 143 responses, 73% had attended or are planning on attending university whilst 17% said that they did not or are planning not to attend university. 10% of participants were unsure as to whether they would be going to university or not.

 

Further examining student loan uptake among prospective, current, and former students, it was discovered that 57% had taken or will be taking out a student loan. On the other hand, 36% did not or will not be taking out a student loan. 7% said that they were unsure as to whether they would be taking out a loan or not. This was the case for a 19-year-old brother from London who, when interviewed, stated that he was unsure where he would source funding from for his second and third years at university.

We now turn our attention towards those who didn't attend or will not be attending university, focusing on the alternatives which they considered. For the 17% making up for this group, apprenticeships stood out as the most popular alternative. This was the case for a 19-year-old sister from South East, who highlighted that the interest element deterred her from taking out a student loan to go to university, deciding to pursue an apprenticeship acknowledging its benefits and convenience.

 

Those who didn't or will not take out a student loan were given the opportunity to list reasons for their decision. It is important to note that participants were able to give multiple reasons for their decision. The concern of interest (riba) within the student loan stood out as the most common factor (82%), followed by alternative sources of funding (26%), alternative education plans (11%), family influence (11%), financial concerns (5%), and other reasons (3%).

 

With the interest factor claiming top spot, it is worth mentioning that a 21-year-old brother from Wales labelled it as one of the biggest 'dealbreakers' in taking out a student loan; as a result, he pursued alternative sources of funding to support his BA course in Medicine.

Survey participants were then asked if they were aware that student loans contained interest. 92% reported that they were aware of this fact, whilst 8% were unaware. A 19-year-old brother from North West stated that his awareness of this instance influenced him to pursue an apprenticeship.

 

All survey participants were then asked for their views on the presence of interest within the student loans. Figure 6 below presents key criticisms raised by participants, covering a variety of themes.

Following on, respondents were asked if they believe that student loans sit as an obstacle for British Muslim students. 97% agreed that they are an obstacle, whilst 3% disagreed stating they are not an obstacle.

 

The survey then looked at the extent to which participants believed that there is a need for an interest-free alternative to conventional student loans. 90% fully supported the need for one, followed by 9% who agreed to some extent, and 1% who felt that there wasn't a need at all.

 

When asked whether they would have personally taken out an interest-free alternative to the current student loan if available, 86% expressed that they would. Meanwhile, 4% said that they would not, whilst 10% were unsure if they would take one out or not.

We then evaluated how satisfied participants were with the government's efforts to enable an Alternative Student Finance (ASF). On a scale of 1-10, where 1 represents "extremely dissatisfied" and 10 represents "extremely satisfied", a total of 73% expressed dissatisfaction (levels 1 to 4). 11% held a neutral stance (level 5), whilst 16% indicated satisfaction (levels 6 to 10) regarding the government's efforts.

 

Survey participants were asked whether they would endorse an Alternative Student Finance (ASF) if it were ever to be established. Overall, 95% said that they would support such an initiative, whilst 5% expressed that they would not endorse it.

All interview participants were asked to give three words that describe the situation of Muslim youngsters when considering whether to take out a student loan or not. Figure 11 presents their responses in the form of a word cloud.

Case Studies

 

Case Study 1: Ryan Roberts Solano, 25, from West Midlands

 

Ryan is a university graduate now working in islamic education who came to the United Kingdom to pursue further education studies. He had taken out a student loan and at the time wasn't a Muslim, however witnessed first-hand the struggles faced by Muslim peers regarding student loans. Ryan praises the United Kingdom for its general accessibility to education compared to other countries. He highlights that during the coronavirus pandemic, there were young Muslim sisters who worked full-time to fund their university studies. He emphasises that education is an essential part of being a Muslim, and Muslims should strive for education to work towards a better society. Despite the split opinions among scholars on whether taking out a student loan is permissible, Ryan suggests that one may decide to take a risk. However, he states that from a religious standpoint, it wouldn't favour taking such risks. He admits that it is a problematic situation, and that if students end up leaving to study abroad it would ultimately affect the talent pool in the United Kingdom. Ryan supports Alternative Student Finance (ASF) as being the viable solution to this overall problem, which could also help get 21-26 year olds back into university who missed out due to the challenges of the student loans.

 

 

Case Study 2: 18-year-old sister from London

 

This sister has just finished her A-Levels and currently holds an offer to study at Oxford University. However, due to mixed opinions regarding the permissibility of student loans, she remains uncertain about her decision, which has consequently affected her mental health. She acknowledges that higher education is crucial in enabling one to be successful in life but is struggling with the conflicting advice from various Sheikhs and Imams, complicating her ability to make an informed decision. Whilst many fields offer apprenticeships, she notes that areas, for example languages, demonstrate minimal to no alternatives to university. This leads her to question the value of pursuing an apprenticeship in a field she doesn't even desire. Currently, she is campaigning on this issue and has even written a letter to her MP, though she is yet to receive a response. Furthermore, she points out the slowness in development of Alternative Student Finance (ASF), citing government discussions on the topic since 2012. She is aware that there is a possibility for delays in initiating an Alternative Student Finance (ASF) due to changes needed in the current student finance system before such can be introduced. Amid the challenges, she praises her school for being very supportive on the matter, which reached out to a scholarship funder which she previously utilised. Additionally, she reached out to the Islamic Society (ISOC) at Oxford University for potential advice and assistance. However, at this moment, there remains no clear solution to this problem, impacting her ability to pursue further education with confidence and peace of mind.

 

 

Case Study 3: 25-year-old sister

 

This sister is currently studying at university, having started at the age of 24. Upon completing her A-Levels, she felt hopeful when then-PM Theresa May mentioned that there would be an Alternative Student Finance (ASF) scheme on its way. However, change in government resulted in these plans being sidelined. Seeking advice from various scholars on the matter, she decided not to take out a loan and instead chose to self-fund her studies. She worked for three years to save the money required for her course, during which she faced some shocking experiences. This included discrimination when applying for jobs, as well as mistreatment from colleagues. Despite these challenges, she stood strong and was able to save enough money to begin self-funding her course. She received great support from her sixth form, with one teacher expressing that the world would be missing out on her if she didn't pursue university. Regarding the launch of the Alternative Student Finance (ASF), she remains doubtful about its release anytime soon, however is supportive of the idea that it would also help non-Muslims in deprived areas who would not have to bear the financial strain of the current student loan system. Starting her further education slightly later allowed her to make a more confident decision about her course, as she felt more mature and aware of her options. Recognising a shortage in her chosen field, this influenced her to pursue a career in that respective area. However, she admits that the prejudice she faced when applying for different jobs impacted her mental health, limiting her opportunities and forcing her to rely on certain employers. Even then, she has faced exploitation, and is now considering changing her name to improve her chances.

 

 

Case Study 4: Sofien,18, from London

 

Sofien is currently on a gap year, having previously received three apprenticeship offers. He is now using his social media presence as a force for good, by helping others in their apprenticeship and further education pursuits. Sofien acknowledges multiple factors influencing his decision not to go to university, with the presence of interest within the student loans being the main turning point. Without the interest component, university might have been a viable option for him, viewing it as a fair transaction, although the concern over debt would still be in his mind. From his perspective, he believes that the current student loans system traps students and exploits their financial literacy, given the cumulative interest on top of the loan. Even for those in high-paying jobs, repaying the loan remains a significant challenge. Sofien notes that whilst some take a gap year for leisure, many, including Muslims, use this time to save money for self-funding their university studies. He feels there is a lack of attention on this issue. He emphasised the importance of being serious and working towards one's goals and encouraged thoughtful consideration on how to pursue university or other pathways that will ultimately benefit you. In his case, after doing research, he decided to pursue an apprenticeship. He stresses the need to make a mature decision that aligns with one's beliefs and aspirations.

Discussion

 

Initial survey findings show that university remains popular among British Muslim students, with 73% stating that they have attended or plan to attend university. However, a notable difference emerges on the matter of student loans, with 57% of prospective, current and former students indicating that they have taken or will be taking out a student loan. This compares to 36%, who did not take or will not be taking out a student loan. It indicates that a concern regarding student loans does exist among British Muslim students. In addition to this, the 7% who were unsure contributes to this view that there is potential deficiency in public trust when it comes to the student loans system.

 

It is not surprising to see that the presence of interest stands as a key factor in influencing British Muslim students when it comes to student loan decisions. This concern is expressed even by those who have already taken out the loan. For instance, a 19-year-old brother from London, currently in his first year studying physiotherapy, expressed his worry regarding the cumulative interest on student loans. He urged those who plan to take or have taken out the loan to pay off their loans quickly to avoid getting into further debt.

 

Figure 4 does show that alternative sources of funding are also key in influencing student loan decisions. However, limited opportunities mean that very few students are able to access such opportunities. For example, fully-funded scholarships and application-based bursaries. This situation can lead some students to privately fund their studies or pursue multiple gap years to work and save money, as demonstrated in Case Study 3.

 

With 92% of survey participants aware of the fact that student loans contain interest, it is fair to say that this feature is not overlooked by the vast majority. Many interviewees mentioned different stages in their lives when they first discovered this aspect. We can consider the example of Shuayb, 17, from North West who first learned about this when he was around 11 or 12 years old. Furthermore, his experience with the Islamic Finance Guru strengthened his understanding of the topic.

 

Figure 6 voices the concerns that British Muslim students have regarding the presence of interest within student loans. Criticisms vary across different themes, supporting the view that participants analyse the practicality of student loans from multiple angles, even in cases of necessity. From a financial standpoint, participants admit that engaging with such loans can limit your financial freedom and hinder the ability to achieve future life goals sooner than expected. Criticisms also reflect on the system's inability to promote social justice, as the loans affect the financially vulnerable and ultimately benefit the student loan companies profiting from repayments of the loan and added interest. Furthermore, there is a gender-specific criticism that some Muslim women cannot pursue university due to concerns about the student loan system, leading many to mistakenly assume their religion is to blame when, in reality, it is the student loans system itself.

 

With 97% of survey participants agreeing that the current student loan system acts as an obstacle for British Muslim students, this reinforces the view that there is somewhat of a lack of public confidence in the system. Additionally, Figure 8 supports the notion that there is a need for an alternative, with 90% of participants fully agreeing and 9% agreeing to some extent.

 

The statistics presented above Figure 7 indicating a preference to take out an interest-free alternative, if available, to the current student loan go to show that British Muslim youngsters would likely favour such alternative to fund their higher education. In fact, 86% stated that they would consider taking out such an alternative, supporting the view that an initiative like Alternative Student Finance (ASF) would likely see significant uptake among British Muslim students.

 

When asked about their satisfaction with the government's efforts in enabling an Alternative Student Finance (ASF), the majority of participants expressed a negative view, with 73% of participants dissatisfied (levels 1-4). This reflects a widespread belief among British Muslim students that government efforts have been insufficient, further suggesting that law-makers haven't shed much light on the issue.

 

Interviewees were also asked whether their representatives (i.e. MPs, national-level politicians) had taken much action regarding the prospect of Alternative Student Finance (ASF). However, no interviewee mentioned any representatives, and even in Case Study 2 where an effort has been made to engage one, the MP is yet to respond. The lack of engagement suggests a gap between law-makers and the concerns of young British Muslims, underscoring the need to advocate and support their educational needs.

 

In the case of non-political representatives, a 21-year-old brother from London praised Sheikh Abdul Wahed Stephenson, a scholar with an established qualification in finance. He noted that this individual provided insight into the matter of student finance through lectures, clarifying important points regarding the topic.

 

If Alternative Student Finance (ASF) were ever to be made available, our findings show strong support among British Muslim youth, with 95% of participants approving such an initiative.

 

Figure 11 presents a word cloud reflecting the terms used by interviewees to describe the challenges British Muslim students face when considering student loans for further education. Compromising, guilt, conflicting; these are just some of the many words used to describe the challenging situations many British Muslim students go through when considering whether to take out a student loan or not. It supports the view that the decision of taking out a student loan isn’t one done with ease, and is something which many struggle with.

 

Considering the facts and figures from this study, it is worth noting that a mini-documentary is planned for release in the next 4-5 months. This project will aim to visualise the findings from this study, whilst engaging with concerned individuals who can offer their insights and potential ways out to this issue. Furthermore, the findings of this report can be used when reaching out to law-makers to express the need for action in facilitating Alternative Student Finance (ASF).

Advice and Recommendations

 

Interviewees were asked to give words of advice to those who are currently going through such challenges. 

 

A 21-year-old sister from South West, currently in her final year of university, emphasised the importance of trusting the plans of Allah (God). Whilst making a sacrifice may feel like a loss, this sister made clear that there is always a better plan for you. She advised calculating respective finances, seeing if you can work to pay it off. She stressed the need to take the first step, always remembering that Allah (God) will make it easy for you. 

 

In addition to his previous insight, Shuayb, 17, from North West highlights that the presence of Muslims in the finance sector will be pivotal for future initiatives regarding student loans. He raised the prospect of potential partnerships of these individuals with universities in the future.

 

Hamza from Yorkshire and The Humber, who is currently studying his A-Levels, recommended exploring other options for funding one's further studies. For example, fully-funded scholarships. Alternatively, studying abroad may be another option as there are scholarships available on an international level as well. If neither of these options are effective, then he would advise looking at what can be paid off upfront before considering taking out a student loan.

 

A 19-year-old brother from South East, who previously engaged in a degree apprenticeship, shared two alternatives for those challenged by student loans. The first is apprenticeships, which are now available across many fields. This model of learning allows one to earn whilst they learn. This not only helps in skill development but also opens doors for career progression. Secondly, there is the option to study at the Open University. This is a more affordable option compared to traditional university. This route provides flexibility, being able to study both full-time and part-time. Nevertheless, you are able to access flexible payment options and can study from home, saving on travel and accommodation. Upon qualification, you will receive a recognised UK degree which can then be used for employment and further study pursuits.

 

The same 21-year-old brother from London who provided input earlier shared a valuable principle he learned from the book, The Courage to Be Disliked. The principle underlines the importance of using the resources and options available to you, whilst also understanding your motivations and goals. In the context of the student loans, he suggests that one should carefully consider their options and look upon the reasoning behind their decisions. This way, you are able to find relief in your choices and avoid feelings of doubt and regret.

 

Finally, there is the advice of a brother from London who is in his second year of university studying chemistry. He encourages those currently in university to push through their challenges and urges those who are yet to start to consider other options. He says that if you leave something for the sake of Allah (God), then you will ultimately be rewarded for that sacrifice.

Conclusion

 

Having interacted with many remarkable individuals over the past few months, it has been enlightening to understand the different impacts that student loans have had on the pathways of Muslim youngsters in the United Kingdom. It is not easy when deciding whether to take out a student loan or not, given the conflict of opinions and obscurity on the matter. As we have seen in the Case Studies, there are many people who hold a dream but without pursuing further academics, it can become increasingly challenging. It is even more disheartening when considering those aspirants, like that of Case Study 3, who have to go through such hardships. This should never be the case and one should never have to endure such conditions in their pursuit for further education. The findings of this report justify the view that there is a need for an Alternative Student Finance (ASF), one which is accessible and open to everybody. It isn't just British Muslim youth which will benefit from such an initiative, but even those in deprived areas and from financially vulnerable backgrounds would finally be able to pursue their dreams without the burden of financially overwhelming barriers. In the end, it would be social justice who is the winner.

 

Understanding the impact that interest-based student loans have on British Muslim youngsters across the country, we urge the government and law-makers to address this issue in order to conserve and utilise our talents. Within every individual there lies a talent, but to unearth it is dependent on the opportunities and platforms provided. A drainage of talent is the last thing a society needs, as ultimately it is the future doctors, lawyers, mechanics, and teachers which we will miss out on. 

Author's Note

 

A previous version of this article referenced a 2013 study by the Federation of Student Islamic Societies (FOSIS) and the National Union of Students (NUS), which was said to have found that 10% of Muslim students avoid university each year due to interest-bearing student loans. As no publicly accessible version of this study could be located, the article has been updated to reflect more recent and verifiable data from Muslim Census (2021), which found that 1 in 10 qualifying Muslim students were deterred from attending university due to concerns about student finance. We are committed to maintaining the accuracy and integrity of our research.

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