President Barack Obama has signed a law that finalizes his health care overhaul and makes the government the issuer of all federal college loans.
The president completed the measure at Northern Virginia Community College, where he emphasized new help for college students.
The legislation was the second of two steps needed for the Democratic-led House and Senate to approve a health care package affecting virtually all Americans.
The new law makes a series of "fixes" to the one Obama approved last week. It removes some unpopular provisions among other changes.
"It represents a major step forward," Obama told the college audience.
In the same swoop, Democrats added in a rewriting of college aid which cuts commercial banks out of the student loan business, drying up a multibillion dollar profit stream.
The new law strips banks of their ability to issue federal student loans in favor of direct government lending.
The student loan overhaul fulfills a long-time goal of Democratic lawmakers to end the bankers' role as middlemen and replace them with direct federal loans and aid to students.
The White House said the change would save taxpayers $68 billion over the next decade. The money saved will help expand and strengthen the federal Pell Grant program for students.
The change will cap college graduates' annual student loan repayments at 10 percent of their income, spends more at community colleges and awards $2.55 billion to historically black colleges and universities.
While student groups and Democratic lawmakers have backed the overhaul, student loan giant Sallie Mae and other private lenders have staunchly opposed it.
Opponents say the action will reduce students' lending options and eliminate the jobs of thousands of private lenders, hurting efforts to remedy an ailing U.S. economy that has a 9.7 unemployment rate.
A number of lawmakers, most Republicans, opposed the measure, saying it would end a successful program and amount to an unwarranted federal takeover of the student loan industry.
Private lenders would still have a role, albeit a greatly diminished one, in servicing loans, such as helping collect payments.
