Better grades, lower interest rates

http://www.channelnewsasia.com/stories/singaporelocalnews/view/416545/1/.html

SINGAPORE: As more people consider returning to business school during the downturn, one bank is offering an unusual carrot to this pool of postgraduate and students at private institutions.

Introducing its new education loan on Thursday, Citibank Singapore is offering top performers lower interest rates - an industry first, according to the bank.

Students who graduate in the top tier of their cohort will qualify for a 0.5 percentage-point reduction in the interest on their loan. Currently, the bank extends education loans with an interest rate of 4.99 per cent a year, for up to five years after graduation.

So, a student who takes a S$100,000 five-year loan on a deferred scheme — where only interest is paid while studying, followed by monthly instalments of the principal and interest upon graduation - could end up saving S$1,600.

For now, the loan is open to students from the Masters in Business Administration (MBA) programmes at Nanyang Technological University (NTU) and Insead, as well as undergraduates at the Management Development Institute of Singapore (MDIS) enrolled in business degrees from the University of Wales and University of Bradford.

To be counted as a top performer, students at NTU will need a minimum grade point average (GPA) of 4.5 out of 5, those at Insead must make the Dean’s List at least once, and MDIS undergraduates will have to graduate with first class honours.

“The courses were selected based on their popularity as well as the existence of well-defined grading criteria,” said Citibank.

Over the next six months, the programme may be extended to at least 10 schools, including the MBA programme at the National University of Singapore and the varsity’s Risk Management Institute.

How attractive are the unusual loan terms? A final-year, part-time MBA student at NTU, Siti, 32, said while the loan provides “an incentive to do well”, it is “very hard” to get a GPA of 4.5.

Those who are working have to juggle their studies and work, she said, adding that perhaps full-time students would be more in need of a study loan.

An MDIS spokeswoman told TODAY the scheme would “give students more options and make them work harder to get good results”.

Typically, undergraduates at the three public-funded universities who need education loans get them from the Government administered through banks, or from the universities themselves.

Postgraduate and private institution students, however, would usually need a commercial loan. “The market for such loans is a sizeable one,” noted Citibank Singapore’s head of secured finance solutions Vibha Coburn.

Last December, TODAY reported on the increase in applications for MBA courses at various business schools, with working adults looking to possibly hit the books during the recession.

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have such promo?
I wish they extend to more courses though...
I wonder.. if I can ever reach that MBA...