A newly proposed income-contingent loan scheme for Irish third level students will have a "disproportionally" negative impact on those with rural backgrounds, the Union of Students in Ireland (USI) has warned.

The proposed loan scheme was recommended last December as part of a government-commissioned report which examined the funding of the Irish higher education system. The review comes amid reduced funding for colleges and universities, rising student numbers and fewer academic staff being employed by higher learning institutions.

The USI said that the controversial scheme would cause changes to the current grant system that will have a negative impact on families from rural backgrounds, such as the introduction of asset testing for grants and replacing grant payments with loans.

"Any implementation of the new proposed loan scheme for students would disproportionately affect those from rural and agricultural backgrounds, deter them from applying to college, and widen the gap between urban and rural opportunities." Kevin Donoghue, USI president, said.

Mr Donoghue added that, "students from rural backgrounds already face greater financial strains than those from urban areas due to transport and accommodation expenses."

"People from rural backgrounds are more likely to be on 3rd level grants and so are more likely to be affected by the new proposals. For example, 67 per cent of students at LYIT (Letterkenny Institute of Technology) are on the grant, compared to only 24 per cent of Trinity students," he explained.

Mr  Donoghue urged those from rural backgrounds to vote for a party who will increase students support such as the student assistant fund alongside increased grants for both undergraduate and postgraduate students.

He also urged voters to prioritise parties who commit to reducing the registration fee, which currently stands at €3,000 per year.

"For many families, education is already unaffordable. It should be a right, not a privilege. Although, politicians say that free education would be a huge strain on the state, every other country in the EU, with the exception of the UK, have lower registration fees and better student support," he commented.

He added that free education must be a key priority for the next government.

"Free education enables social mobility, breaks poverty traps, empowers the youth and creates a level playing field where true equality is possible. It should be a priority for the next government," he said.

"This is why the USI is urging families across Ireland to vote for parties who will prioritise education and brighten the future of their children," Mr Donoghue concluded.