Legislation which would mean people can be arrested at the border if they refuse to repay their student loan, passed its first reading under urgency on Wednesday night.
The Student Loan Scheme Amendment Bill (No 3) will also increase the repayment rate for those living overseas.
The Government says borrowers living overseas are responsible for 80% of overdue loan repayments which now total about $535 million.
The bill passed its first reading by 61 votes to 59, with the support of National, ACT and United Future.
It will now be considered by the Finance and Expenditure Select Committee.
