Duncan asked Congress "to get this done as soon as possible," saying the plan would let millions of students lock in loans for the upcoming school year at rates far below current ones, saving them $1,500 over the life of a typical loan, The Washington Post reported.
"This bipartisan compromise is a win for students," Duncan told reporters on a conference call.
"This is an important first step, but it is just a step," Duncan said, noting the more than $1 trillion in outstanding student loan debt and the soaring cost of a college education also must be addressed.
The Obama administration earlier Tuesday called on Congress to swiftly pass the bipartisan compromise.
The White House said in a statement the plan caps the interest rate on student loans at 8.25 percent for undergraduate school loans, 9.25 percent for graduate school loans and 10.25 for PLUS loans, a federal loan program involving a student's parents.