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How to tap the CPF Education Scheme to Pay for Study Loan

CPF Study Loan
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While studying is already a given pain, keeping up with the finances as a student makes it heavier. Over the years, entering college has been more inaccessible because it was deemed expensive. 

However, children and parents have been more eager to ensure attaining education is likely despite the circumstances. This has prompted an increase in financial help and the ballooning of student services.

The National University of Singapore and Nanyang Technological University are amongst the highest-ranked institutions across the globe. 

Between the two, NUS’s fees could normally range up to S$8,200 while NTU could go around from S$7,850 to S$15,700. Also included in the top five universities in Singapore is the Management Development Institute of Singapore, wherein students are expected to pay approximately S$5,029. 

Meanwhile, the other two— NUS Business School’s dues range from S$33,570 SGD to S$38,740 SGD, and Singapore University of Technology and Design’s goes around S$12,400 to S$26,000 SGD.

These normally vary for domestic and international students. It’s also possible that it depends on the courses one will take. 

Fortunately, there is the CPF scheme ensuring Singaporeans have a good financial foundation ahead of their retirement. It has since evolved to cater to the people more flexibility such as support when purchasing a property and financing tertiary studies.

The CPF Education Scheme

The CPF Education Scheme allows you to use your Ordinary Account savings to compensate for your own subsidised tuition fees. On the other hand, applications to use the CPF to pay for your sibling’s or relative’s subsidized tuition fees will be assessed on a case-by-case basis.

Note that those on fulltime subsidised diploma​​/degree courses at Approved Educational Institutions or AEIs are covered under this scheme. The student would have to begin repaying the principal amount withdrawn plus the accrued interest in cash to your account, a year after the graduation or termination of studies, whichever comes first.

Listed below are some of the university and polytechnic institutions that are eligible for the CPF Education scheme:
  • National University of Singapore
  • Nanyang Technological University
  • Singapore Management University
  • Singapore Institute of Technology
  • Singapore University of Technology and Design
  • Singapore University of Social Sciences
  • Nanyang Academy of Fine Arts
  • LASALLE College of the Arts
  • Nanyang Polytechnic
  • Ngee Ann Polytechnic
  • Republic Polytechnic
  • Singapore Polytechnic
  • Temasek Polytechnic

Full-time students paying subsidised fees for degree or diploma courses awarded by the above-mentioned institutions are eligible for the CPF Education Scheme but keep in mind the application windows for each school are different from whatever is noted here.

Eligibility for using the CPF Education Scheme

According to the CPF Board, you and/or the student may apply for the programme if you meet the following requirements:

  1. You are using your Ordinary Account savings to pay for your own, children’s, spouse’s, siblings’ or relatives’ tuition and miscellaneous fees.
  2. You have enough OA savings and Available Withdraw Limit to be used under the CPF Education Scheme.
  3. (As indicated earlier,) the course registered is a full-time subsidised diploma/degree course at an Approved Educational Institution.
  4. Keep in mind that there is no need for a guarantor unless the student is a foreigner. You can refer to the Board’s Terms and Conditions for Use of CPF under the CPF Education Scheme on the guarantor eligibility criteria.

It’s reminded that more than one person can tap on their CPF monies to pay for the tuition fees of the same student, should both parents be applying to use their CPF under the CPF Education Scheme for the same child. 

During this situation, deductions will be made so the applications will be received. However, if the first parent does not have enough CPF monies to fully cover the tuition fee that is due, the second parent’s CPF will then be used.

After all available CPF OA monies have been taken off, should there be still a mishap, the student will need to make up the shortfall in cash, take a loan under the MOE Tuition Fee Loan Scheme, or seek out financial help.

Thus— and furthermore, if an organization or course does not fall under this programme, you and the student can consider taking up a loan with commercial lenders or approaching the organization for other financial aid alternatives. There are existing tuition fee loans, bank education loans or personal loans in Singapore that may help.

How much can I borrow?

It can be noted that you can use your OA savings up to the Available Withdraw Limit under the Education Scheme. The Available Withdrawal Limit is either 40% of your accumulated OA savings or your remaining OA balance. The value that can be used is also subjected to the tuition fees payable.

What are the conditions that I have to meet before I can apply to waive the education loan repayment? If you are 55 years old or older, you must set aside the Full Retirement Sum in the Retirement Account before making use of the remaining savings in the OA up to the Available Withdrawal Limit. The FRS can be set aside fully with cash or with cash and property.

Remember that the Available Withdrawal Limit will change should there be a new withdrawal, repayment or refund in your OA. You can easily check your Available Withdraw Limit and its other details on the CPF website using your SingPass.

How do you pay back?

Students can use the CPF Education Loan Repayment Period Calculator to compute the repayment period or the Monthly Instalments Rate Calculator to work out on a suitable loan repayment plan.

It’s expected the student will receive a letter from the CPF with the loan dues three months before it commences. Should the student intend to begin paying earlier, the student can contact the Board through the e-Concierge service.

Repayment is encouraged to be made in cash either in one lump sum or via monthly installment over a maximum of 12 years. The monthly installment rate will be calculated for the student based on the loan amount and repayment duration.

Note that learners must repay the full loan as early as likely to save on the interest payable and to allow the account holder to use these monies for the housing and retirement needs.

Application requirements you will need:

  • CPF account number or NRIC,
  • telephone number; and an
  • email address.

If anything, find out the account number or NRIC, telephone number and e-mail address of the CPF member, whose CPF you are applying to use under the CPF Education Scheme.

How will you apply?

Now that you’re almost good to go, here are the things you must remember: There are an application time and process:

The application period for each Approved Educational organization varies as it depends on the beginning of the school’s academic semester. You may refer to the application schedule to check the dates prior to applying for the loan. No application will be accepted after the cut-off date.

When applying online using my CPF, the student must log in with SingPass and submit the application via My Requests. An email with an URL will be sent to your email address provided by the student in the application form approximately within two days.

Remember that you must enter your SingPass within two weeks from the date of the application, to agree to the use of your CPF savings. Otherwise, the request would be easily rejected. The student can log in with their SingPass at the CPF website to check the loan application status under My Activities.

The Bottomline

Remember that being accepted into the school of your choice is only half the battle. For the next couple of years, you’ll be going through different struggles that will prepare you for real life. While balancing academics and other activities can be challenging, there are some who also need to worry about paying for their education. 

Most pupils have the skills and talent to study in Singapore’s top universities, but as it is one of the most expensive locations across the globe, not everyone considers to apply because of the fees. Indeed, getting a student aid can make the tuition more manageable and can help learners pursue their desired careers.

For guides that will assist you on your financial worries such as your study loan, check more on Loan Advisor, your trusted one-stop loan comparison portal.

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