Using the CPF Education Scheme, you can use the savings in your CPF Ordinary Account or OA to apply for an education loan to pay for subsidized tuition fees for yourself/your child/your spouse’s sibling/your relatives at any approved educational institution and for an approved course.
The subsidy on tuition fee under this loan scheme will be determined on a case to case basis.
How does the CPF Education Scheme work?
Under this scheme, you can only apply for full-time degree courses or diploma courses at approved educational institutions (AEIs).
1 year after you graduate or upon termination of your studies (depending on whichever of the 2 occurs earlier) you have to start making repayments on the principal amount + accrued interest via cash to your CPF.
If the course/institution of your choice is not covered under this scheme, you should consider other options such as applying for a loan from a commercial bank or financial institution OR approach your institution and request for options for financial assistance.
Are you eligible under the CPF Education Scheme?
You are eligible to apply for this scheme under the following circumstances:
- You use savings from your OA for tuition fees for yourself/your child/your spouse’s sibling/your relatives.
- You have enough savings in your OA and Available Withdrawal Limit or AWL for use under this loan scheme.
- You have registered for a subsidized full time degree/diploma course at any of the AEIs.
- Even foreigners are eligible to apply for the CPF Education Scheme. However, if you are a foreigner, you will need a guarantor.
How much OA savings can be used for the CPF Education Scheme?
You can use a maximum of 40% of savings in your OA as per one of the following:
- 40% of your accumulated savings in OA – This includes the current balance in the account + any amount previously withdrawn for investment/education etc. It does not include housing withdrawals.
- 40% of remaining OA balance – Any amount set aside for housing or any other scheme (if applicable).
If you want to check your AWL for this loan scheme, follow the steps below:
- Use your SingPass to log into your CPF Account.
- Go to “My Statement” and check the available amount.
If you are 55+ years, you must set aside your applicable BRS or Basic Retirement Sum/ FRS or Full Retirement Sum having sufficient property pledge/charge in your RA or Retirement Account before you can use the balance savings in your OA for this scheme.
Note – If you make any new repayments/refunds/withdrawals from your OA, your AWL will change accordingly.
Using your OA savings for paying the tuition fees under the CPF Education Scheme
You can pay the whole tuition fees (100%) using your OA savings. But if you are using your savings to pay for a relative’s tuition fees, the percentage will vary as per the following:
- 50% if they are studying at an approved art college.
- 25% if they are pursuing a TED (Technical Engineering Diploma)/Polytechnic/Culinary Arts at an ITE (Institute of Technical Education).
- 10% if they are going to study at a university/foreign specialized institution under Poly-FSI (Polytechnic-Foreign Specialized Institution).
Loan Repayment under the CPF Education Scheme
The student will have to start making repayments 1 year after he/she graduates or their studies are terminated, depending on whichever of the 2 occurs earlier.
The CPF Board will send the student a letter regarding their repayment information 3 months prior to the commencement date of their loan repayment. If the student wishes to start making the payments before the commencement date, the same can be done by raising a request using the e-Concierge service which can be found under “My Request” on the CPF website.
The accepted mode of payment is CASH and to be made either through monthly instalments over a maximum tenure of 12 years or through lump sum payments. The amount for monthly instalments will be determined depending on the borrowed amount and loan tenure.
It is advisable to repay the loan as soon as possible in full because it will help save on interest which can later be used for other useful purposes including housing and/or retirement. This is possible by making lump sum payments that go beyond the instalment amount.
Note – To see how long it will take for repaying the Education Loan, students can use the “CPF Education Loan Repayment Period Calculator” or the “Monthly Instalment Rate Calculator” to determine a viable loan repayment scheme.
How can the student make repayments?
The student can make repayments through the following ways:
- E-Cashier services. AXS stations.
- Cheque – the cheque should be crossed and payable to “CPF Board” and mailed to the CPF Board along with completed “Form AES/F7”.
How is the interest computed for the CPF Education Scheme?
The interest on this loan scheme will start accruing from the point you withdraw savings from your OA and until the loan is repaid in full. The interest rate for this loan is pegged to the OA interest rate and is adjusted on a quarterly basis.
Deferring Loan Repayment under the CPF Education Scheme
Students have the option to defer the loan repayment for withdrawn CPF savings under the following circumstances:
- They are serving full time NS (National Service).
- They are presently unemployed.
- They are studying full time.
Waiver of repayment on the CPF Education Loan
The repayment of the education loan under this scheme can be waived if the student meets the waiver criteria/conditions provided he/she has graduated or terminated their studies.
Those who are 55+ years old, can apply for waiver only after setting aside their applicable BRS or Basic Retirement Sum/ FRS or Full Retirement Sum having sufficient property pledge/charge in your RA or Retirement Account.
Also, if you are withdrawing the balance in your CPF Accounts because you are leaving Singapore/West Malaysia or due to medical reasons, you can also contact the CPF Board to see if you are eligible for a waiver on your education loan repayment.
What should you consider before you decide to opt for the CPF Education Scheme?
There are many options in addition to the CPF Education Scheme for financing your tertiary education. You should take into consideration the following to decide which type of loan is suitable for you:
- What other loan schemes are you/the student eligible for apart from the CPF Education Scheme?
- How much of your OA savings can be used to finance the education loan under this scheme? Can the savings fully finance the student’s education?
- Will using up your OA savings affect your retirement/housing needs?
- How will the loan repayment estimation affect your total interest?
Applying for the CPF Education Scheme
The application period will vary depending on the start date of the course for each of the AEIs. All applications must be submitted before the cutoff date, otherwise they will not be accepted.
- Applying online – my cpf:
- The student has to log into the CPF website using their SingPass and apply through “My Requests”.
- You will receive an email along with a URL within 2 days at the email address the student has provided for you.
- You then have to log into the CPF website using your SingPass within 14 days from the application date agreeing to use your CPF savings to finance the student’s loan. If this is not done, the student’s application will be rejected.
- Applying through Mail:
- Foreign students/students pursuing education under Poly FSI have to complete the form, “FORM AES/F1: Application for Use of CPF Savings under the Education Scheme” and submit it along with all the supporting documents (if applicable) to the institution by the deadline.
Note – The student can check the status of the loan application under “My Activities” on the CPF website when they login using their SingPass.
Applying for waiver of loan repayment under the CPF Education Scheme
- Applying Online – my cpf:
- Login to the CPF website using your SingPass.
- Go to “My Requests” and submit the waiver application.
- Applying by Mail:
- Download the form, “FORM AES/W1: CPF Education Scheme Application for Waiver of Repayment”.
- Complete this form and mail it to the CPF Board.
To check the status of the waiver application, login to the CPF website using your SingPass and check under “My Activities”.
Note – It is better to submit an online application because it will be processed faster.
The CPF Education Scheme is best suited when you applying for it to finance your own education as you can use it for paying 100% of your tuition fees. If you are use your OA savings to finance the tertiary education of your relatives’, you can also explore other loan options as you can only finance a maximum of 50% of their tuition fees.