Student loan payments may also be suspended for up to two months to give borrowers "greater flexibility during the national emergency", according to a US Department of Education statement.
The move allows borrowers to "temporarily stop their payments without worrying about accruing interest" with interest rates set at zero per cent.
Mr Trump said the administration will consider extending that timeframe and suggested other student loan actions could be forthcoming.
The announcement arrives as Americans brace for significant financial shortfalls while underemployment claims skyrocket and businesses shutter in the wake of the pandemic.
In a statement, Education Department Secretary Betsy DeVos said: "These are anxious times, particularly for students and families whose educations, careers, and lives have been disrupted ... Right now, everyone should be focused on staying safe and healthy, not worrying about their student loan balance growing."
Borrowers must request the forbearance from their loan servicer.
Secretary DeVos also has suspended payments for any borrower more than 31 days late as of 13 March to give them a "safety net" during the crisis.
Democrats — including candidates throughout the 2020 race for the Democratic presidential nomination — have pressed for more sweeping student loan support, compared to the relatively limited scope of the latest White House efforts.
A group of Senate Democrats have called for $10,000 in immediate loan cancellation, and for the Education Department to assume borrowers' monthly payments. Those payments would allow borrowers seeking loan forgiveness through repayment plans to count towards those efforts. Democrats also proposed suspending wage and tax refund garnishments as well as Social Security deferrals for borrowers facing defaults.
In a statement earlier this week outlining the proposal, Senator Elizabeth Warren said: "Last time our economy crashed, this country made a devastating mistake: we turned our backs on students and families to bail out the giant banks. Student loan borrowers — especially students of colour — never fully recovered from that economic punch to the gut. This time around, by cancelling student debt payments for millions, we will fix the mistake that still holds back a generation of people and dragged down our economy."
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