The Student Protection Scheme aims to simply protect students in two ways: by locking your money in a safe place and through insurance. Let’s run through each of them.

The first scheme is called the Student Tuition Fee Account (Escrow). It simply works this way. Let’s assume that you are an international student wanting to study at XYZ School in Singapore. Whether you make an initial payment or full payment, that payment will go directly to the bank – for now, there are two banks involved with this scheme – DBS & HSBC. The bank holds the money until the 5 th day after your course has commenced. On the 5 th day, the school will receive 30% of the course fees. The rest of the course fees will be received by the school in equal monthly instalments.

Let’s assume that you have made 30% upfront payment and you are required to make $500 monthly payment to the bank each month. This payment can be made through cheque, telegraphic transfer, cashier’s order amd bank draft. For DBS, it boasts that students are allowed to make the payment to the bank through any of 900 ATMs around the island. So for DBS, it’s key in the pin number – without TT or any other bank charges – and presto, the money is transferred to the bank in a matter of seconds!

So is paying the schools through the escrow account good? For you as a student, it is a direct good but there may be indirect disadvantages. Let’s compare things before and after this scheme was introduced. In the old days (we are referring to pre-2005), an international student would pay its fees direct to the agent/school, the school receives the lumpsum payment and the foreign agents would demand for their cut immediately. What is positive about this is the cash flow and financial freedom it gives the private school. However, this may be bad if the owners roll the money into other investments, and therefore spend your money on other things.

So isn’t it safer for your money to be locked up with a bank? Of course it is. However, a problem may arise who schools with shallow pockets. You see, on the 5 th day after the course commences, the school will receive 30 per cent of the course fees from the bank. This 30% may be insufficient for the school as it has to pay the agent immediately - anywhere between 10% to 20% of your school fees. After deductions from the agents’ fees, the school may not be able to recover the monies spent overseas to aid in the recruitment drive. Therefore, some schools may have not a cent of profit even though you have started the course. Fortunately, the banks may extend a loan to the schools. But the word here is “may”. What if they don’t extend that loan? I leave it to you to conclude.

I know I am leaving you feeling unsure but the point is this – you are covered - as long as your fees are concerned. That’s the good news. But I do not want you to think that everything is OK just because the Student Protection Scheme is here. Risks are a part of life. Though Singapore is efficiently run, it does not mean that there are no dangers of losing your effort, time or whatever. This applies to all countries that you want to study in. Do not behave like a domesticated person. Question everything until you are satisfied. Question even the contents of what I written. And by the way, the Student Protection Scheme does not cover exam fees, accommodation and other fees outside the course fees. Do visit http://www.singaporeedu.gov.sg/htm/mis/faq06a.htm for questions to ask school/agent so that there are never any surprise payments.

The other aspect of the Student Protection Scheme is insurance. Please note that under the Student Protection Scheme, schools are given the freedom to choose either locking up your money in the escrow account or taking an insurance policy for you. I am sure most schools prefer the latter (ie. taking the insurance policy). However, the Singapore government (now I am guessing here) would have probably instructed the banks to allow only schools with very good financial standing and high benchmarks the allowance to receive such insurance policies. So by virtue of this, I believe most schools would have their course fees locked up in the escrow account.

Now, the Student Tuition Fees Insurance is given out by NTUC Income (a well known, trusted and respected quasi-government instititution in Singapore) and it covers the students in 2 ways:

Loss of tuition fees paid in advance by students to the school

1.Insurance for death or total permanent disability of the student

(Maximum of S$10 000)

Personally, I feel the insurance is a better option as it gives the responsible but not-so-big-yet school the speed and freedom to build and strengthen its school. However, both schemes are great in terms of protecting the students’ tuition fees (and mind you, it only covers the tuition fees only).

Well, I have made many personal observations and perspectives. These are just my views. It is really up to you, if you are serious about studying in Singapore, to check the facts and the reality of things before you take your leap. All the best.