Education Loans in Singapore | Loan Options for Students in Singapore

Education Loans | Loans
by Priyadarshini 7 March 2023

In Singapore, the university is a stepping stone to a potentially profitable job. Whether you study at NUS, NTU, SMU, SIM, MDIS, PSB Academy, or a foreign or international university, the degree is expected to increase your earnings in some way. And if you want to earn a handsome salary, you need to spend money first! University education is not cheap, whether in Singapore or elsewhere. In this blog, we talk about education loans in Singapore.

Even the cheapest choice for studying at a local public institution will cost you at least a five-figure sum for your whole degree. 

Education Loans in Singapore

Eligibility Criteria for the CPF Education Scheme

You don’t have to go to a bank for a loan if you want to enroll in a local institution but don’t have the cash to pay. The CPF Education Scheme is available to students pursuing their first undergraduate degree at the following institutions:

Here the Polytechnic-Foreign Specialised Institution (“Poly-FSI”) Framework includes NTU NUS SMU SIT SUTD SUSS NAFA Lasalle Institutions. You can use your parents’ CPF to pay for up to 100 percent of your course fees. It is granted under the CPF Education Scheme. You must begin repaying the loan a year after graduating or ceasing your studies, whichever comes first. For good reason, the CPF Education Scheme is chosen by the vast majority of local university students.

CPF Ordinary Account

The interest rate is linked to the CPF Ordinary Account interest rate, which is now 2.5 percent, and it is lower than the interest rate on most bank education loans. So, in most situations, the CPF Education Scheme is one of the most affordable financing choices for university students in Singapore (apart from the “Mum & Dad scholarship,” of course).

Even if you are enrolled in one of the CPF Education Scheme-approved courses, you will still have to pay some money out of pocket. For example, if you are enrolled in any of the following courses:

  • Once you are a student at an art institution, you can only withdraw up to 50% of your course costs.
  • You study in a polytechnic or pursue a Technical – Engineer Diploma or Technical Diploma in Culinary Arts at ITE, you can only withdraw up to 25% of your course expenses.
  • And you are in a university or a foreign specialized institution through the Polytechnic-Foreign Specialised Institution framework, you can only withdraw up to 10% of your course expenses.
  • Your parent’s CPF Ordinary Account is insufficiently funded or has hit the Withdrawal Limit.

CPF Education Scheme

You are also ineligible for the CPF Education Scheme if you are in a part-time diploma or degree program. Or if you are not qualified for subsidised tuition (such as if you are undertaking a second undergraduate degree when you have already studied for a prior subsidised undergrad degree, or you are not a Singapore citizen).

MOE Tuition Fee Loan

Another option for local university students is the MOE Tuition Fee Loan, which allows you to borrow up to 90% of your tuition fees. There is zero interest while you are still studying. Except for NAFA and Lasalle students, this is open to all local public university students.

In general, if you aren’t utilizing the CPF Education Scheme and the MOE Tuition Loan is available to you, it’s a good idea to take advantage of it. Because you won’t be charged interest while you’re studying. Most education loans will charge you interest before you graduate. This makes MOE Tuition Fee Loans less expensive than traditional education loans.

In case you pay off your loan fast after graduation, the MOE Tuition Loan Fee may be even less than the CPF Education Scheme.

Eligibility for MOE Tuition Loan

You do not qualify for the CPF Education Scheme or the MOE Tuition Fee Loan if you are the following:

  • For example, those pursuing private university degrees managed by MDIS, PSB Academy, or Kaplan.
  • Also, those who are going abroad will have to rely on education loans provided by banks.

These are the various options for education loans in Singapore. Are you a student looking to pursue higher studies? Want to know more about education loans? Head to the blog section and read more on loans in Singapore. 

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