Student loan interest rates have been reduced from 5 per cent to 4 per cent.

The decision was made by the Student Loan Payment Review Committee (SLPC) on Wednesday.

According to the committee, there are about 1.2 million Australians aged 16 and above who have been loaned a student loan.

More than 100,000 borrowers in the Northern Territory, Queensland and South Australia are in the same situation, the committee said in a statement.

Students are now eligible for the loan forgiveness of 5 per, 6 per, 8 per, 12 per and 16 per cent, depending on their income, and their previous loan repayment.

They are also entitled to up to $250 in loan forgiveness for loans outstanding from December 2017 up to and including March 2019, up to an annual maximum of $1,000 and up to a maximum of one year of repayment.

Loan forgiveness applies to loans in repayment of the student loan and not the principal amount.

Those borrowers who were already eligible for loan forgiveness will be eligible for full forgiveness up to June 2019.

In total, the SLPC reduced the interest rates for loans in payment of the loan from 4.3 per cent up to 3.4 per cent and from 4 per to 3 per cent for loans that have already been repaid.

It also reduced the loan repayment term from six months to four months and from one year to three years.

As a result, loan forgiveness is only available to those borrowers with outstanding student loan debt of more than $150,000, which means most borrowers have already had the interest rate reduced.

However, it will be a while before borrowers have the opportunity to get a loan repayment plan in place.

To apply for loan relief under the SLpc, borrowers need to submit their loan repayment agreement form online, or complete the loan application form in person.

If you or anyone you know needs help with student loan repayment, call Lifeline on 13 11 14.

Read more about loan forgiveness in Australia here: Read about student loan interest reduction in Australia