As a world-class country, Singapore is the best destination for the best healthcare, education, and employment in Asia. However, extremely high costs will always accompany high educational standards.
Thankfully, Singapore’s banks and financial institutions come ready with helpful education loans for Singaporean citizens and permanent residents.
A loan gives borrowers a considerable amount in a short period. These are useful if you need to pay hefty fees, such as your university payment fee, and have flexible repayment options.
On average, a Singaporean family can spend about $8,000-S $33,000 on tuition fees per student in the household. DBS’ data suggests that an average four-year undergraduate program can cost S $40,000 in total.
If you look closely at university costs data, Singapore’s education costs are already catching up. True enough, a loan is costly given the height of educational loans, especially if you think about the loan’s processing fees, interest charges, and possible penalties.
Truthfully, the service charges we’ve mentioned above can make your final total payment huge by the loan tenure’s end. But, if your priority is to take advantage of a course promo, but you’re short on cash, an education loan from DBS, OCBC, and other financial institutions is a must.
If you’re looking for the best financing from DBS, OCBC, Maybank, and CIMB, we’ve compiled them all below. Our criteria are to provide the most affordable education loan for Singaporeans and PR students.
Keep this list handy, especially if you’re currently researching for the best financial products presently available.
|Bank and Product||Interest Rate Per Annum||Processing Fee||Average Monthly Payment|
|4.38%||2.5% of the total loan amount||S $371.77|
|4.38%||2.5% of the total loan amount||S $371.77|
|4.50%||2.5% of the total loan amount||S $372.86|
|4.45%||2% of the total loan amount||S $372.41|
|5.39%||2% of the total loan amount||S $381.01|
*All data in this chart assumes a $20,000 total study loan amount payable in 5 years. Data derived from March 2021
Let’s take a closer look at each of the financial products we’ve listed above.
DBS Study Loan
With the DBS study loan, students can go to virtually any university. Guarantors and parents can borrow up to 10 times their salary up to an S $160,000 maximum amount. Plus, the guarantors and parents can pay the total loan amount earlier or cancel the study loan without any penalties. All approved loans will have a 4.38% yearly interest rate, and you’ll need to pay a one-time 2.5% processing fee. Loan tenures can last up to 10 years.
POSB Further Study Assist
POSB’s study loan offer is closely similar to DBS’s offer. Students can go to any university because guarantors can borrow up to 10 times their monthly salary up to S $160,000. There are no early redemption or cancellation charges, too. The education loan from POSB is subject to a 4.38% per annum interest increase and a 2.5% processing fee once the loan application receives approval. Loan tenures can last up to 10 years.
OCBC Frank Education Loan
The FRANK education loan is Singapore’s most well-known bank-financed education loan. It offers up to 10 times your monthly salary up to S $150,000. Plus, OCBC gives you flexible repayment options with variations on fees, charges, and penalties. All approved financing will have 4.5% interest updated yearly and a one-time 2.5% processing fee. Borrowers must pay the full student loan amount in 8 years.
Maybank Monthly Rest Education Loan for Local Studies
If you’re applying for local universities, Maybank’s education loan might be your best option. While it offers only eight times your monthly salary, this amount is enough to pay for a student’s entire college course. The Maybank Monthly Rest Education Loan gives you up to 8 years to pay for the education loan. Plus, all approved financing is subject to a 4.48% interest rate and a 2% processing fee.
CIMB Monthly Rest Education Loan for Local Studies
CIMB’s offers rival those of DBS and POSB with its long loan tenure of ten years. However, CIMB’s education loan offer has the highest interest rate of 5.39% per annum if you compare it to the 4.5% average in this list. However, you can borrow up to eight times your monthly salary up to S $200,000. Whichever your loan amount, you’ll need to pay a 2% processing fee.
Singapore’s public universities have loan partnerships with the country’s top banks to provide suitable and attainable education loans for its student population. These special education loans allow the university to subsidize up to 10% of the total tuition fee, extend the payment period up to 20 years after course completion, and reduce the monthly tuition payment to a manageable S $100. The terms and conditions for both Singapore University/NIE and Polytechnic education loans vastly differ from each other.
Eligibility and Requirements
All students who fall into any of the following criteria cannot apply for special university loans in Singapore
- Students receiving any statutory board or school scholarships that cover tuition fees
- Tuition Fee Subsidy from MENDAKI receiving students
- CPF pays 100% of the student’s subsidized tuition fees
- Self-Funded Course STudents
- Non-Singapore Citizen/Permanent Resident Singaporean students
- Guarantor or parent is aged from 21-60 years and is not a discharged bankrupt
You must bring these requirements or upload them to your respective bank’s application portal:
- Application Form
- University Letter of Eligibility or Offer
- Student and Guarantor NRIC and Passport
Education loans can still be massively expensive, even if you have special university loans as an alternative. On the other hand, you can use the following as alternatives to finance your education.
Bursary or Scholarships
If you have an aptitude for learning that your evaluators and peers highlight, you can apply for bursaries or scholarships. Truthfully, it’s a challenging trek to maintain top student performance and only for the educationally driven.
Apply for a scholarship by simply submitting your form to your chosen scholarship organization. Keep in mind that some scholarships focus on different industries. Here is a list of scholarship providers to get you started.
- Singapore International Graduate Award (SINGA)
- Commonwealth Scholarship for Integrative Sciences and Engineering
- ADB-Japan Scholarship Program for Developing Countries in Asia and the Pacific
- NTU Fully Funded Nanyang Undergraduate Scholarships
- Lee Kong Chian Graduate Scholarships at NUS
- Singapore Government Scholarships for Southeast Asians
- ASEAN Foundation (AF) Scholarships in Development, Environment, and IT
- INSEAD Greendale Foundation MBA Scholarships
- NSEAD Nelson Mandela MBA Scholarships for Africans
- INSEAD-Syngenta MBA Scholarships for Developing Country Leaders
MOE Tuition Fee Loan
Singapore’s Ministry of Education provides a special education loan that’s quite affordable than bank-offered financing. You’ll need to download and fill up the application form, including the blank Letter of Offer, and then submit it to the nearest DBS branch, which their dedicated locator can give you. Both guarantor and student must present themselves personally at the bank.
Moneylender Personal Loans
A licensed moneylender personal loan offers you up to six times your monthly salary, a flat 4% interest rate per annum, and flexible loan terms. Guarantors have to fulfill similar requirements as banks minus high credit scores to use personal loans as education payments.
Here are six valuable points we highly suggest considering heavily to make the best decision about all the financing options listed here.
- Loan Amount: Most university fees are fixed amounts, giving you the loan amount you need to borrow. If the amount is too high, it might be best to consider other low-tuition educational institutions.
- Interest Rate: Failing to properly calculate study loan interest rates has led many guarantors and students in deep debt. Calculate rough estimates to ensure you have prepared for virtually any situation.
- Repayment Period: While 20-year education loans might sound good, the high-interest rates per year will bog down on your payments. However, 8-10-year education loans are equally challenging.
- Fees, Penalties, and Other Charges: Aside from interest charges, consider the additional fees, penalties, and charges accompanying your chosen financial product.
- Monthly Payment Schedule: A too-high monthly payment schedule can be problematic for your current budget. However, you might pay higher interest for lower monthly payment schedules unless it’s a school-subsidized financial product.
- Early Repayment Fee: Banks calculate their returns inclusive of your yearly interest rates. Skipping out will mean paying them a fixed sum for the remaining years.
The course cost is the actual education loan limit. On the other hand, some banks limit loans from S $150,000-S to $200,000. Read or inquire about your bank’s offers to learn which options can work for you.
Some banks offer overseas equivalents of their local university education loans. For example, Maybank’s Monthly Rest Education Loan and CIMB’s Monthly Rest Education Loan have an overseas variant enabling Singaporean students to study in schools anywhere in the world.
Any financing that provides you funding can pay for your tuition fees. However, education loans are streamlined financial products specifically for student loan payments. Plus, some universities subsidize scholarship costs with specific bank loans, such as those we’ve described above.
Depending on the loan’s terms and conditions, you will need to pay back the remaining balance despite your dropping out. On the other hand, some banks can freeze the interest rate increases until you successfully apply and graduate from another school. However, you might need to take out another loan to start studying in your new school.
The best way to find the perfect study loan in Singapore is to research deeply on all available products suitable for you or your guardian’s financial capacity.
GM Creditz is one of the most reputable licensed moneylenders in Singapore that provides financial solutions and a plan that considers the client’s capability to repay.
We guarantee the lowest possible interest rate and flexible repayment terms to finance your study needs efficiently. Reach out to our service-oriented loan officers today.