Hundreds of thousands of New Zealanders will be hit in the pocket by sweeping changes to student loan repayments on April 1.
People earning more than $367 a week will have to pay more towards their student loan debts and graduates making additional, voluntary repayments will lose out when the "voluntary repayment bonus" is scrapped.
The Government said the new rules would help students pay back loans faster - and save taxpayers money.
However, University Students Association president Pete Hodkinson said graduates with loans would spend less and businesses would suffer.
The changes to loan repayment rates mean someone earning $1000 a week will pay an extra $658 a year. "This, for most people, will mean things like not going out to dinner (as often)," Hodkinson said.
"If 200,000 people are now not spending money in an industry like hospitality ... think about the economic impacts."
Inland Revenue said as of New Year's Eve, 692,019 students and ex-students had loans.
Hodkinson said poorer graduates were already struggling with debt.
"We have payments forced below the poverty line because of a repayment threshold of $19,084," he said.
That threshold was well below New Zealand's median weekly income, which last June was $29,120.
People choosing to pay back loans quickly will no longer be rewarded.
Currently, people making voluntary payments of $500 or more a tax year on top of obligatory repayments earn a 10 per cent bonus, credited to their loan account.
University of Auckland arts and commerce student Cindy Smart said the bonus scheme should stay.
"I didn't realise they were getting rid of it. It was quite a good incentive to pay [the loan] off faster."
She expected her loan to ultimately reach $35,000.
In 2011, Treasury said more than 2600 people repaid student loans within a year of borrowing, earning $1.8m in bonuses.
When graduates were included, total bonuses were about $13m that year. Bonuses were limited to an 11th of a person's loan balance.
Auckland University Students Association president Daniel Haines said scrapping the bonus was "unfair and harmful" to students.
Fourth-year arts and commerce student Sam Morton also supported the bonus but had no quarrel with other changes.
"It was too good a deal to sustain," said Robert Hou, a fourth-year engineering student.
Hou expected his loan to reach $40,000.
The bonus had not created the surge in repayments the Government had hoped for, a spokesman for Tertiary Education Minister Steven Joyce said.
He also said people who could afford to finance their studies had instead borrowed because of bonuses.
Student allowances - such as those offered to students whose parents earned less than $55,027 a year - would also be slashed in the changes.
Haines said the new policies made study less attractive. "If people can't afford to study in New Zealand they'll go elsewhere."
But Smart said this country was still a good place to study. "It's still significantly more expensive to study overseas."