US SC rejects President's $400 billion student loan forgiveness plan, Biden says will protect borrowers

United States Supreme Court has ruled against government's decision to wave off student loans. Top Court stated, Biden administration overstepped its authority in trying to cancel or reduce student loans for millions of Americans.

The 6-3 decision, with conservative justices in the majority, effectively nullified President's $400 billion plan to enforce students to make loan repayment by late summer.

The court held that the administration needs Congress' endorsement before undertaking so costly a program. The majority rejected arguments that a bipartisan 2003 law dealing with student loans provided the authority Biden claimed.

White House sources suggest, US President says he will allow new actions to protect student loan borrowers.

The court's decision is expected to come as a huge disappointment to the 26 million borrowers who had applied to have up to $20,000 in student loan debt forgiven. The Education Department had already approved the relief for 16 million applicants.

Chief Justice John G. Roberts Jr. relied on two grounds - firstly, he stated the statutory grant of authority to the secretary of education to “waive or modify” loan terms could not be stretched this far. Secondly, he said a mass debt cancellation program of this level of significance required clear congressional authorization.

(With Agency inputs)

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