More time given to repay student loans

Graduates from polytechnics and autonomous universities here will be able to put off repaying their student loans for another four months, as the Government seeks to support those whose employment may be affected by the pandemic-induced economic uncertainty.

These loan repayments and interest charges were earlier suspended by the Ministry of Education (MOE) for a year from June 1 last year to May 31 this year. The extension means graduates from autonomous universities and polytechnics will not have to start repayments until after Sept 30.

The Finance Ministry said in a separate statement that the extension will give graduates more time to find a stable financial footing and to plan their finances.

No interest, whether standard or penalty interest, will be levied on any outstanding government loan for the additional four months. This includes tuition fee loans, study loans and overseas student programme loans.

MOE said those with outstanding loans will be granted the extension automatically.

They include graduates who have started repaying their loans and students who graduate before Sept 30 and still have loans to repay. Those who wish to continue repaying their loans can do so by informing their tertiary institutions and banks to make the necessary arrangements.

Finance Minister Lawrence Wong said there is scope to extend the suspension even further, but that will depend on the state of the current outbreak and whether the economy can recover from it, he said at a virtual media conference yesterday.

He said: "Before the latest round of heightened alert measures, the economic outlook was improving... and if you look at the employment prospects for fresh graduates, they were also improving.

"But given the latest situation, the uncertainty that the new (virus) strains have posed not just to Singapore but also to the global economy... we discussed with MOE and decided that we would give a short extension."

Mr Wong added: "If the situation indeed does improve, and this current outbreak proves to be temporary, we get back to our recovery trajectory and the external economy remains strong, then I think September should be a reasonable time frame.

"But if things were to worsen, be it on the external front or even within Singapore in terms of our own growth trajectory, then, of course, we will be prepared to reconsider and see if further extensions are needed."

Mr Shivaram Rasu, 27, graduated from the National University of Singapore in June last year and has yet to start repaying his $40,000 student loan. While the research assistant has no issues with repayment, he said the extension will help those who may still be struggling.

"The economic climate has been quite uncertain so in a period like this, this extension will be a blessing,"he said.