I intend to take a loan to finance my education and I will repay it promptly upon my graduation. Which is better for me – the MOE Tuition Fee Loan (TFL) or CPF Education Loan?
The MOE TFL is a better option as it is interest-free during the course of study, unlike the CPF loan where interest starts to accrue from the time of withdrawal. This means that if you repay the loan fully right after graduation, you will not incur any interest at all for the TFL. For scenarios comparing the two loans, please refer to the following document:
Additionally, being a loan from MOE, the TFL repayment and interest can be suspended in periods of economic downturn. For instance, MOE has suspended the TFL repayment and interest from 1 June 2020 to 30 September 2021 to support households affected by Covid-19, and had done so in the past as well. On the other hand, repayment of the CPF education loan and interest cannot be suspended as it is to restore the member’s CPF savings for his retirement needs, and retirement security remains important, if not more so, during economic downturns.
