WASHINGTON – United States President Joe Biden’s administration will cancel US$39 billion (S$52 billion) in student debt for more than 804,000 borrowers, the Education Department said on Friday, describing the relief as the result of a “fix” to income-driven repayment (IDR) plans.

Borrowers will be eligible for forgiveness if they have made either 20 or 25 years of monthly IDRs, the Education Department said.

The IDR programme caps payment requirements for lower-income borrowers and forgives their remaining balance after a set number of years.

“These borrowers will join the millions of people that my administration has provided relief to over the past two years – resulting in over US$116 billion in loan relief to over three million borrowers under my administration,” Mr Biden said in a statement.

The department said the relief addresses what it described as “historical inaccuracies” in the count of payments that qualify towards forgiveness under IDR plans.

“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” Secretary of Education Miguel Cardona said.

Mr Biden has said he will pursue new measures to provide student loan relief to Americans after the Supreme Court blocked his plan to cancel hundreds of billions of dollars in debt.

The Education Department launched a regulatory “rule-making” process to pursue his US$430 billion loan relief plan. That process is expected to take months.

Friday’s relatively smaller relief falls under a separate, payment count adjustment programme that the Biden administration announced in April last year, the department said.

In a statement, Vice-President Kamala Harris said the administration “will continue to fight to make sure Americans can access high-quality postsecondary education without taking on the burden of unmanageable student loan debt.” REUTERS