As the article clearly shows, the risk in student loans is that the student will accrue more debt that they can handle and not get a high enough income to pay down the principle, in which case the lender will end up getting their money back far far slower than planned. Just because there isn’t a risk of default doesn’t mean there isn’t any risk. If American Student loans were risk free profit at 8% the entire financial market would rush to invest, bringing about competition and driving down the rates.