Aissa Canchola Bañez, the center's policy director, described it as a crushing blow to millions of Americans already struggling to cover college costs.

Roughly 8 million borrowers whose student loan payments have been on pause for a year will start to see interest accrue on their debt again in August, the U.S. Department of Education said.

The interest charges for people enrolled in the Saving on a Valuable Education, or SAVE program, will begin on Aug. 1, according to an Education Department official, although, for now, borrowers do no...