Interest on federal student loans: zero since April 1, 2023

Here is the most important interest fact in Canadian student aid, stated plainly: since April 1, 2023, no interest accrues on the federal portion of Canada Student Loans or Canada Apprentice Loans. The elimination is permanent, not a temporary holiday. It was announced in the Fall Economic Statement of 2022, enacted through the Fall Economic Statement Implementation Act, 2022, which received Royal Assent on December 15, 2022, and it followed a two-year interest waiver that ran from April 1, 2021 to March 31, 2023, so there was no gap in interest-free status. If you borrowed before April 1, 2023, interest that had accrued before that date is a separate matter — the regulations note that borrowers remain liable for interest that may have accrued prior to its elimination — but nothing new accrues on the federal portion after that date.

What zero federal interest means in practice

It means your federal balance does not grow while you study, does not grow during the six-month non-repayment period after you leave school, and does not grow during repayment. The amount you repay on the federal portion is the principal you borrowed, minus any grants that were never repayable and minus any RAP payments the government made on your behalf. That changes the usual loan arithmetic completely: there is no interest cost to minimize by repaying the federal portion early, though early repayment still frees up monthly cash flow. The usual reason to pay extra is to clear the provincial portion faster, where interest may still apply.

The provincial portion is a different story

Provincial and territorial portions of your loan are governed by your province or territory, and several still charge interest. The exact rates move with prime and with provincial policy, so this site does not quote provincial rates as settled fact — they are the numbers most likely to be out of date in any guide, including this one. The reliable statement is structural: in integrated provinces, the NSLSC administers one combined loan, but the federal share inside it is interest-free while the provincial share follows provincial rules. Before you accept any loan, ask your provincial student aid office two questions: does my provincial portion charge interest, and does interest accrue during the six-month non-repayment period? The answers change the true cost of your loan, and they differ by province.

The interest-free federal policy also changes how RAP works in practice. Under RAP, the government's promise to pay interest your reduced payment does not cover matters less for the federal portion — there is no federal interest to cover — and matters more for any provincial portion that does charge interest. It also means that a borrower who stays on RAP long enough reaches the stage where the government pays down principal sooner in effect, because no new federal interest is being added to the balance in the meantime. None of this is a reason to borrow more than you need, but it is a reason to borrow federal first, and to compare any private loan — which will charge interest from day one — against an interest-free federal loan with unusual care.

Sources: Government of Canada, Annual Financial Report 2023-2024 (permanent elimination of interest effective April 1, 2023; Fall Economic Statement Implementation Act, 2022, Royal Assent December 15, 2022); Employment and Social Development Canada, Consolidated Financial Statements 2024-2025 (loans permanently interest-free since April 1, 2023; typical repayment period 10 years, maximum 15); Canada Gazette Part II, SOR/2026-139 (no interest accrued since April 1, 2021; liability for pre-elimination interest).