Student advocates are celebrating New Zealand First's policy, which would allow graduates to pay off their debt by working in the country.
Under the party's Up Front Investment Tertiary Policy, for every year a student stayed in New Zealand and worked after finishing their studies, one year would be deducted from their education skills debt.
Union of Students' Association president Linsey Higgins said anything that addressed the problem of student debt was a good thing for the country.
"The big issues for us are around it stopping those next transitions in life," she said. "Our research shows that it's making people ask questions around whether they're able to have kids, whether they're able to buy a house and whether they're able to retire well."
"If people aren't able to do those things then that has a further ramification [for society] down the line," she said.
Ms Higgins said the Association helped New Zealand First with the idea, and was committed to working with all parties in its advocacy for students.
"Significant variances in course costs and graduate wages can see some of our most important members of society such as nurses and teachers left with the burden of debt for longer. This policy treats all graduates as equal. One year's study equals one year of skills commitment," she said. "If implemented, this policy would be a game changer for students".
The Tertiary Education Minister Steven Joyce said the policy was unaffordable and would be a budget blow-out.
"We already, as a group of taxpayers, provide interest free loans to those that stay in New Zealand," he said. "As a result 85 percent of student loan borrowers are in New Zealand right now."
"They're already paying off their loans, on average, in about six years."
"It would cost billions of dollars and we think there would be other priorities if the government had that sort of money sitting around," he said.
Taxes already covered 70 to 80 percent of the costs of tertiary education, which usually resulted in a higher lifetime income, said Mr Joyce.