President Barack Obama on Friday called for the government to stop backing private loans to college students and replace them with direct government loans to young people.

This proposition comes as a challenge to a decades-old program with strong congressional support.

Obama's plan to eliminate the Federal Family Education Loan program could save $48 billion for taxpayers over the next decade, but this plan could risk turning the Education Department into a national bank, critics have warned.

The proposal, which Obama backed as a U.S. senator and pushed during the presidential campaign, was met with opposition by lenders and some college officials.

According to the president's proposal, the current federal student loan system would be converted to direct lending from the government.

Lenders view this proposal as an end to a historically lucrative business.