BOSTON • A new report from a Boston-based research center found that nearly a quarter of all student loan payments made in 2019 went to interest, and is calling for a no-interest loan structure to be implemented to address the college debt crisis.

The Hildreth Institute report said that if the federal government was to implement this program change, it would provide economic relief to current and future borrowers, who are often saddled with so much interest that they can’t make substantial progress on paying down their principal student loan balances.

The report claims that interest payments are taking up a larger portion of student loan payments than ever before — surging from $13.1 billion in 2015 to $22.4 billion in 2019.

“Under the current system, many student borrowers see their outstanding balances grow even as they make their monthly payments,” said the report’s author, Bahah Akman Imboden, managing director of the Hildreth Institute. “Low-income students and students of color are disproportionately impacted by this.”

Akman Imboden said that 20 years into repayment, the median Black borrower still owes 95% of the amount they borrowed, compared to the median white borrower who has already paid off the majority of their loan.

The concept of negative amortization, the report said, refers to interest accumulating faster than borrowers are able to make payments on their loans. The accumulated interest is added to the principal amount, compounding interest and increasing future monthly repayment obligations.

The report notes that this struggle leads borrowers to seek out income-based repayment plans, which offer lower monthly payments, but often lead to a much larger loan amount that needs to be paid off due to the interest that accumulates during the debt extension.

While the report acknowledges plans from the Biden administration that are set to take effect in July 2023, which would limit the ways interest can engorge debt or eliminate debt in cases of fraud, school closure or disability, it is calling upon federal leaders to do more — by removing the interest obligation entirely from student loans.

This would enable borrowers to pay down debt quicker by making monthly payments that go directly to the principal balance. To offset the cost of doing this, the report suggests that the federal government could invest principal repayments in a risk-free asset, which would “generate a return to cover administrative costs and issue new loans.”

The report estimates that for the average student on an IBR plan with $35,000 in student loans, eliminating interest would lower their monthly payment from $327 to $145, which could conceivably save them $18,500 over the lifetime of their loan.

“Eliminating interest is not going to end the student loan crisis, but it’s one way we can make it easier and less expensive for students,” said Bob Hildreth, founder of the Hildreth Institute.