As the name implies, the idea with IBR is that monthly student debt service payments are based on the borrower's disposable income. The less money one makes, the less one has to pay. Each monthly installment under the program counts as a "qualifying payment", and after 300 of these, the balance of the loan (assuming it's not paid off after 25 years), is forgiven. Perhaps the most interesting thing about this scheme is that it allows for "payments" of zero. Here's what we said back in April:

After 300 "qualifying monthly payments" — so after 25 years of payments — any remaining balance is forgiven and legally discharged. The interesting thing about this is that if the calculated payment is zero, it still counts as a "qualifying monthly payment." That is, if, based on the borrower's financial situation, he/she is not required to make an actual cash payment for a period, that period still counts towards the 300 "payments" needed to have the balance of the debt discharged, meaning that in the end, borrowers could end up paying substantially less than principal (taxpayers eat the balance) and are effectively allowed to remain in a perpetual state of default while avoiding actual payment default along the way.