Provincial student loans in Newfoundland and Labrador are officially a thing of the past.

As of Saturday, these loans have been replaced with non-repayable grants.

Newfoundland and Labrador is the first province to completely eliminate its student loan system.

Student advocates have pushed for the change for years.

"When students graduate with large amounts of student debt, they're less likely to start a family, buy a home, buy a car, start a small business," said Travis Perry, the provincial chairperson of the Canadian Federation of Students.

nl travis perry munsu director of finance 20131107

Travis Perry, the provincial chairperson with the Canadian Federation of Students, says students have been fighting for a non-repayable grants system for years. (CBC)

"So with this shift to upfront grants, those students will be more likely to go out and do those things and contribute meaningfully to the economy in those ways."

The PC government spent $12.6 million this year on implementing the initiative, and will spend a total of $50.6 million on the program between 2014 and 2019.

Around 7,000 students are expected to be eligible for the funding.

Perry says it's a step forward — but there's still more work to be done, with the upcoming provincial election this fall.

"Students will be looking to all parties to build upon that foundation, to continue moving forward and improving access and improving quality of post-secondary education so that we have the most highly skilled, highly educated workforce possible to contribute to and build Newfoundland and Labrador's economy and future," he said.

Perry says provincial student loans only cover 40 per cent of students' financial assistance. Federal financial aid is still in the form of loans with interest.