
A good education is essential for anyone competing in Singapore and the world’s tight ship of highly-qualified professionals. Furthermore, it gives a young student’s mind the right tools and perspectives to help them solve problems. However, education in Singapore is undeniably expensive, justifiably so thanks to their efficacy.
Thankfully, student loans in Singapore make it convenient to have enough cash to study. All students or their guarantors can just pay it later once the student graduates. Here is everything you need to know about education loans.
Types of Loans Available for Students
Every Singapore bank and the financial institution offers excellent rates for student loans. Education loans have a flat rate and Monthly Rest option.
Flat rates have fixed-term interest throughout the loan. This is viable if you’re looking for stable payment amounts.
Monthly Rest has a lower or higher repayment amount that isn’t consecutively the same. Most of these loans available from banks include your accommodation and daily living expenses.
Below is a table that can help you compare their education coverage, interest rate per year, and monthly repayments.
Bank | Loan Educational Coverage | Interest Rate Per Year | Regular Payment Per Month | Maximum Principle Loan Amount | Maximum Loan Tenure |
POSB Further Study Assist | Local Studies | 4.38% | SGD $372.00 | SGD $20,000 | 5 Years |
Maybank Monthly Rest Education Loan | Local Studies | 4.45% | SGD $372.00 | SGD $20,000 | 5 Years |
DBS Study Loan | Local Studies | 4.38% | SGD $372.00 | SGD $20,000 | 5 Years |
OCBC FRANK Education Loan | Local Studies | 4.5% | SGD $373.00 | SGD $20,000 | 5 Years |
RHB Monthly Rest Education Loan | Local Studies | 4.78% | SGD $375.00 | SGD $20,000 | 5 Years |
CIMB Monthly Rest Education Loan | Local Studies | 5.39% | SGD $381.00 | SGD $20,000 | 5 Years |
How Do You Qualify For Student Loan Singapore?
Students in Singapore must fulfill the following education loan requirements. These are the typical requirements banks and financial institutions will ask of you. Depending on your lender, you might need to fulfill other additional requirements
- Singapore citizen
- Aged 21-62
- Have qualified guarantors (such as parents, guardians, or sponsors)
- Guarantor has S $30,000 minimum income
The Average Education Loan Tenures
Most of the loan tenures in the table we listed above have a maximum of five years. However, banks and financial institutions may allow you to extend your study loan Singapore tenure up to 10 years. Additionally, the ten-year payments won’t begin until the student has completed their studies and signed a contract for gainful employment.
Tuition Fee Loan Fees You Should Take Note Of
Most student loans have an accompanying processing fee. Most banks and financial institutions charge about 2% on your student loan loan amount. However, they deduct this fee from your student loan’s first repayment, which means it’s a small advance to pay for your loan.
Additionally, you’ll be dealing with the following education loan penalty, cancellation, and disbursement fees
- Prepayment penalty of 1% from the original loan amount
- Partial prepayment penalty of 1%
- A cancellation fee of 1%
- Disbursement fee, which depends on your mode of payment (cash, credit, installment, etc.)

Documents Needed to Apply for an Education Loan
If the student is below the age of 21, their guarantor should produce the following student loan documents
- Latest e-statement
- CPF contribution history statement in the last 12 months
- Letter of acceptance from the local or foreign school
- Completed application the student has signed and finalized.
Truthfully, the majority of Singapore’s educational loan providers ask for the parent or guarantor’s details. However, you’ll need to fulfill these requirements if you’re a fully employed Singaporean taking up your second or master’s degree.
The Lowest Education Loan Interest Rate
Banks can change their Singapore study loans interest rates according to the market’s demand. However, Singapore’s parents and citizens greatly value education, which makes this demand unlikely to falter. However, during peak season, banks and financial institutions can lower their interest rates from 3-6% per annum with a possibility of an 8% effective interest rate.
Make it a point to browse through financial products regularly to see if you can take advantage of a possible lower-interest education loan from banks. It might take some effort, but the payoff is undeniably advantageous for any guarantor and student.
Alternatives to a Study Loan in Singapore
If you’re not keen on taking on bank financing, you can use the following to gain aid for your studies. It takes some effort and endeavors to take on some of them. However, licensed moneylenders — the final option — is one of the best options for many Singaporean parents
1. Singapore Government Scholarships
Only highly-qualified individuals can pursue their studies in local and foreign universities using the Singapore Government Scholarship (SGS) program. SGS covers the tution fee of virtually every course offering from universities except for medicine, dentistry, and architecture. It presents perks for students taking up law because they won’t need to go through Singapore’s Bar exam aside from paying for their tuition fee.
2. Private Scholarships
Numerous private companies and organizations provide financial aid for tuition fees to promising students who lack the resources to have education from a qualified institution. However, each private scholarship provider gives aid to students depending on their academic specialization.
For example, the Agency for Science, Technology, and Research provides a scholarship for students who want to pursue their degrees in hard sciences and technologies. However, some government institutions, such as the Health Promotion Board and Housing Development Board, have unique qualifications for potential scholars.
3. Personal Loans Through Moneylenders
A licensed moneylender is truthfully the best alternative to bank educational loans with better interest rates and options. Singapore’s moneylenders provide you ample loan amounts that reach beyond S $20,000, but with lower interest rates and flexible payment options. Furthermore, it doesn’t require guarantors or working students to have an excellent credit score.
Can Licensed Money Lenders Be The Best Choice for Education Loans?
Significantly Low Interest Rate Than Banks
Intending to provide better alternatives to bank financing, most moneylenders offer the same or lower interest rates for personal loans per year than banks, which makes them an excellent alternative to education loans.
Short Term Repayment
Sometimes, five-year educational financing can be quite expensive. However, with a licensed moneylender’s personal loan, you can choose to complete the repayment period, which is usually within two years. Alternatively, you can ask your lender to extend their payment periods too.
No Credit Scores Required
Banks select the borrower who has the highest credit score when possible. Licensed moneylenders place confidence in borrowers who have a stable job and annual income. Truthfully, moneylenders don’t ask for CBS credentials because it has no bearing on their decisions, allowing them to release your unsecured personal loan within a week or less.
It Pays to Resolve Your Student Loan Quickly
An educational loan is still borrowed financing. You’re dealing with interest rates and penalties, making it imperative to resolve your student loan without missing any repayments. Furthermore, it can give you a much-earned peace of mind by paying off your student loan in Singapore smoothly. It can be fulfilling to pay only your estimated interest and principal calculations by the end of the payment term.
Accumulated Debt Interest is Harmful
Borrowing money has a staggering emotional toll on individuals. Some are nervous because they have a shaky monthly income that barely passed the bank’s standards. If you’re not comfortable taking on financing and possible lifelong debt, it pays to have only a few or a single financial commitment and prioritizing your debt payments.
Income-to-Debt Ratio
Most successful borrowers won’t mention it, but you need an excellent strategy to ensure you don’t fall in deep debt and maximize your financing benefits. To pay your student loan quickly, you’ll need to consider your monthly income-to-debt ratio. A good rule of thumb: don’t take on any loans — including student loans — if 50% of your income is going to utilities and other necessities.
Avoid Interest Charges and Penalties
If you’ve conditioned yourself emotionally and considered every aspect of your income and expenses, you’re ready to take on your student loans. Avoiding additional interest charges and penalties is the best way to prevent deep debt and possible forced personal bankruptcy by your lender. If you plan your finances carefully, you won’t have any problems dealing with your student loan.
Get The Best Student Loans From Licensed Moneylenders
Raffles Credit is Singapore’s best-licensed moneylender. We offer outstanding personal loans capable of paying the entire duration of your academic ventures. Visit our website to learn more about our offers and contact us today to get started on your financing!