This would save young Americans from going into crippling debt, but it would also make a university degree completely unaffordable for most. However, in the age of the Internet, that doesn’t mean they couldn’t get an education.
Consider the long term impact of this. There are a lot of different ways such a situation could go, for better and for worse.
I presume that anywhere where interest-free loans are offered, they are offered by that country’s government. Canada, for example, as of April 1st 2023, offers federal student loans interest free. Depending on the province, some may not have interest on provincial loans, as well.
That’s the only way it makes any sense.