Study Now, Pay Later: How to Get a Student Loan in the Philippines
Published: July 14, 2021 | Updated: July 26, 2021 | Posted by: Venus Zoleta | Loans
About 44,000 college students[1] were expected to have stopped schooling in 2020 amid the pandemic. Most of those who might not have enrolled last year said this was due to the economic crisis since most parents have lost their jobs. This year, there’s no reason for you to be left behind because you have alternatives to explore for funding your college education.
Now more than ever, student loans in the Philippines can help financially challenged families. Undergraduate students who may have been declined scholarships and grants can seek refuge from student loans to pay for tuition, gadgets, school equipment, and other costs of homeschooling like internet connection.
Whether you’re a student or a parent, now is the time to take advantage of an education loan in the Philippines that can help those who are eager to continue their college education despite the financial challenges of the pandemic.
Table of Contents
What is a Student Loan?
A student loan is an amount borrowed to pay for the cost of a college education. Also called an education loan, tuition loan, or tuition installment plan, this type of loan usually covers tuition and other school fees, books and supplies, allowances, student accommodations, and other school expenses.
Students who need financial assistance (or their parents and guardians) may apply for student loans in the Philippines.
Unlike scholarships and grants, student loans must be paid back in monthly installments, plus interest, over the entire loan term. Some lenders allow student-borrowers to fully repay their loans after they graduate or find a job.
Scholarships, Grants, and Student Loans: What’s the Difference?
All these terms refer to financial aid for students to pay off higher education expenses. Although scholarships, grants, and student loans may sound the same, these three are entirely different from each other.
For a clearer view, below is an explanation for each type of financial assistance for students in the Philippines.
Scholarships
Scholarships are usually given to students who have passed the academic requirements for eligibility. More often than not, scholarship programs in the Philippines consider the previous grades of the applicant and the current scores incurred after taking an examination to become a scholar.
In essence, scholarships are based on either the student’s academic performance or skills. For instance, Jennifer is a scholar because she was a member of the university’s volleyball team, while Gerald is a scholar because he consistently maintains high grades in his subjects.
You may have a scholarship during your first year in college, but you might lose this once your grades fall below the required rating. Scholarships can also be given full or per semester, depending on the terms of the aid. Government agencies, LGUs, and higher education institutions usually sponsor scholarship programs.
Grants
A grant refers to the amount[2] provided to a student in the form of cash. This is unlike scholarships that may cover a full semester for free without the need to receive an exact amount of financial assistance.
Grants may or may not be based on academic performance. Some sponsors consider the applicant’s economic status. For instance, you can have a grant of PHP 50,000 worth of college funds. This may or may not cover the costs for the entire school year but may be used to pay for tuition and other school expenses.
Student Loans
Student loans are entirely different from grants and scholarships because the amount borrowed needs to be paid back. Whether it’s a government student loan in the Philippines or a loan from the bank, students should return the money according to the terms and conditions indicated in the loan agreement.
So how are such loans considered a form of financial aid? Although you need to pay off the money in the future, the loan eases the financial burden of going to school. Use the loan amount to study and graduate, then start repaying after a specified loan term, or if you’ve earned your degree and landed your first job.
Why Should I Apply for a Student Loan?
Applying for a tuition fee loan is one of the most practical options students and parents can consider. Here are a few reasons why.
1. Cheaper Than Other Types of Loans
Student loan interest rates start as low as 0.50% each month, which is way lower compared to personal loan interest rates from 0.69% and above. Some government student loans also don’t charge application fees, which can be a huge relief for those who are trying to cut education costs.
2. No Credit Score Required
Contrary to credit card and personal loan applications, most student loans don’t check on your or your parent’s credit scores. This means you’ll have a higher chance of approval once you have submitted the correct documents and complied with the requirements.
3. Easy Repayment Terms
Although a few student loans should be paid by the end of the current semester, most tuition loans in the Philippines allow borrowers to pay off the amount after graduation and when they have already found their first job.
4. Helps You Focus on Your Studies
Instead of you and your parents worrying about payment before examinations, student loans give you peace of mind, allowing you to focus on your studies and plan your career.
5. Opens a Wide Range of Opportunities
Once you’ve taken out a student loan, you’ll be trained to manage your personal finance properly. You’ll learn the importance of repaying your debt on time and fulfilling your monthly obligations. It can also be a good start to build your credit history, so you can apply for much bigger loan amounts for business and other investments in the future.
Related article: What Student Discounts are Available in the Philippines?
Where Can I Apply for a Student Loan?
Government agencies, banks, and private lenders in the Philippines provide student loans. For this list, we’ve narrowed down your options to 10 education loans with the best features. Some of them charge low interest, reducing the cost of borrowing. Others have an easy and quick online application for students who need to pay for their tuition urgently.
Here are the best student loans in the Philippines for students who need financial aid.
CHED Student Loan Program
The student loan program of the Commission for Higher Education (CHED) is known as the Tertiary Education Subsidy[3] under the Unified Financial Assistance System for Tertiary Education Act or UniFAST. This program is also known as the Republic Act 10687, which grants financial assistance programs for tertiary education.
Key Features
The UniFAST law covers two categories: Tertiary Education and Special Purpose Education Assistance.
Tertiary Education
Tertiary education refers to the higher education that comes after secondary or high school. It also includes non-degree diplomas, post-secondary and Technical-Vocational Education and Training (TVET), and higher education programs like baccalaureate degrees and graduate education.
Special Purpose Education Assistance
“Special Purpose Education Assistance” refers to activities related to the continuity of an educational program, which includes research and scientific studies in the college and masters/doctoral level funded by Student Financial Assistance Programs (StuFAPs).
The funding covers the writing of manuscripts, publication of books and other academic materials, and production of files or other forms of documentation.
Who Qualifies for a CHED Student Loan?
- Technical Vocational Education and Training (TVET)
- Enrolled or will be enrolling in college or postgraduate degrees
- Filipino citizens
- Non-recipients of other government assistance programs unless the initial assistance does not cover any or all of the following: tuition fees, miscellaneous and other school fees, educational expenses, and/ or cost-of-living allowance (COLA).
- Top 10 graduates of all public high schools are given priority in making student loans. The loans however should be repaid on an installment basis once the student graduates or leaves the school/ college/ university.
Where to Apply for a CHED Student Loan
One can apply for scholarships and grants at CHED, TESDA, any of the departments, and other government instrumentalities such as the DOST, DOLE, DSWD, DND, DA, DILG, DENR, OPAPP, NCIP, among other StuFAP-granting institutions. Loans are provided only by CHED and government financial institutions like LANDBANK, BDP, SSS, and GSIS.
SSS Educational Assistance Loan Program
Key Features:
- Who can apply: SSS members below 60 years old with a monthly income of PHP 25,000 or below and at least 36 posted SSS contributions (six of which are posted within the last 12 months before the month of the education loan application)
- How much you can borrow:
- For four/five-year degree courses: Up to PHP 20,000 per semester
- For two-year technical/vocational courses: Up to PHP 10,000 per semester
- Interest rate: 6% per year
- Fees and charges:
- Maintenance charge: 2% of the loan balance
- Penalty for late payment: 1% per month for any unpaid amortization
- Check replacement service fee: PHP 300
- How long you can repay the loan:
- For degree courses: Up to five years
- For technical/vocational courses: Up to three years
The Educational Assistance Loan Program (EALP)[4] enables SSS members to borrow money to pay for their beneficiary’s college education.
Only one EALP beneficiary is allowed per member-borrower. Beneficiaries can be the member-borrowers themselves, their child, their legal spouse, or their sibling (for unmarried members only)—as long as they’re not full scholars enjoying free tuition and other school fees. They should be enrolled in any undergraduate course offered by schools accredited by CHED, TESDA, Civil Aviation Authority of the Philippines, and other government agencies.
SSS EALP Requirements:
- Accomplished SSS EALP application form[4]
- Valid IDs
- Assessment/Billing statement issued by the beneficiary’s school
- Proof of relationship to the beneficiary (i.e., birth certificate/baptismal certificate/marriage certificate)
- Any proof of monthly income:
- Latest payslip or certificate of employment and compensation
- Latest ITR or BIR Form 2316
- Notarized Affidavit of No Income or Affidavit of Source and Amount of Monthly Income
How to Apply for SSS Educational Assistance Loan
Present the original copy and submit the photocopy of the requirements to the nearest SSS branch. Once the loan is approved, you may claim your check at the Administrative Section of the branch where you applied for EALP.
Currently, there’s no online application for SSS EALP—it’s not included in the E-Services of My.SSS portal. Thus, you need to personally file your EALP application at an SSS office.
GSIS Education Loan and Computer Loan Programs
Key Features:
- Who can apply: Active GSIS members with permanent status and at least 15 years in government service
- How much you can borrow:
- Education loan: Up to PHP 100,000 per school year
- Computer loan: Up to PHP 30,000
- Interest rate: 8% per year
- How long you can repay the loan:
- Education loan: 10 years with a grace period of five years
- Computer loan: Three years
GSIS offers two student loan programs[5] for its members who need to borrow for the school expenses of their children, nieces, or nephews.
One is an education loan for the tuition and other school expenses of GSIS member-borrowers’ beneficiaries enrolled in an undergraduate course of a private or public university. Repayments begin only in the sixth year after the loan approval, when the student-beneficiaries have finished their studies and started working.
The GSIS computer loan is for members who need to buy a laptop and other equipment for their beneficiaries’ online classes.
How to Apply for GSIS Student Loan
Contact GSIS through its call center hotline or official Facebook page to inquire about its education loan and computer loan programs.
Pag-IBIG Multi-Purpose Loan
Key Features:
- Who can apply: Active Pag-IBIG members with at least 24 paid contributions and sufficient proof of income
- How much you can borrow: Up to 80% of the member’s Pag-IBIG regular savings
- Interest rate: 10.5% per year
- How long you can repay the loan: 24 months with a grace period of two months
The Pag-IBIG Multipurpose Loan or Pag-IBIG Salary Loan helps members cover a wide range of financial needs, including their beneficiary’s tuition and other school fees. The loan amount is released through a check or the borrower’s disbursement card.
LANDBANK I-STUDY Program
Key Features:
- Who can apply: Filipino parents and guardians with established repayment capacity and credit history
- How much you can borrow: Up to PHP 300,000
- Interest rate: 5% per year
- Fees and charges:
- Penalty for failure to pay the loan: 24% per year
- Loan processing fee
- Documentary stamp tax: PHP 1.50 per PHP 200 of the loan amount
- How long you can repay the loan:
- For short-term loan: One year
- For term loan: Up to three years, including a one-year grace period on the principal
I-STUDY is a student loan program from LANDBANK[6] that was recently launched to help parents who are struggling to finance their children’s education due to unemployment and other effects of the pandemic.
LANDBANK offers two types of student loans under the I-STUDY program. The first I-STUDY loan is for tuition or enrollment-related fees while the second one is a loan for purchasing electronic gadgets[7] that can be used in online distance learning.
LANDBANK has recently offered the gadget loan with a maximum loanable amount of PHP 50,000. This can be included in the PHP150,000 maximum loan amount applicable to student borrowers and PHP 300,000 maximum loan amount for every parent-borrower.
Qualified students for the program are Filipinos aged 30 and below, of good moral character (as certified by the school), and who are not a current beneficiary of free tuition and other school fees under RA 10931 or any scholarship program.
The I-STUDY program is available only for School Years 2021 to 2022.
LANDBANK I-STUDY Requirements
- Accomplished loan application form
- Borrower’s valid ID
- Borrower’s proof of income
- For employed borrowers: Certificate of employment, latest three-month payslips, and latest ITR
- For self-employed: Business permit and latest ITR
- Proof of billing address and payment record from at least two utility/service companies
- For incoming students: Enrollment form/admission slip with school ID
- For continuing students: Latest enrollment or registration form
- Form 138/Certified True Copy of Grades for the previous semester attended
- Certificate of Good Moral Character issued by the school
- Schedule of payment of school fees and other enrollment-related expenses for the semester or school year
How to Apply for LANDBANK I-STUDY Program
Submit the student loan requirements to the nearest LANDBANK lending center. Once your loan is approved, you’ll be required to open a LANDBANK deposit account where the funds will be credited. Additional documents should also be submitted to the bank before the loan amount is released and after enrollment.
Citi Personal Loan
Key Features:
- Who can apply: Filipinos and foreign residents in the Philippines aged 21 to 65 with a taxpayer identification number (TIN), credit card, and minimum gross annual income of PHP 250,000
- How much you can borrow: PHP 100,000 to PHP 2 million
- Interest rate: 26.9% per year
- Fees and charges:
- Disbursement fee: PHP 1,750
- Documentary stamp tax: PHP 1.50 per PHP 200 of the loan amount
- Monthly late charge: PHP 500 or 6% of the overdue amount, whichever is higher
- How long you can repay the loan: One to five years
Citibank offers a low-interest personal loan with flexible payment terms and a high loan amount limit. Applicants can also get approved in as fast as 24 hours. Such features make the Citi personal loan ideal for borrowing money for college tuition payments.
BPI SIP Loan for School
Key Features:
- Who can apply: Parents with BPI credit cards whose children are enrolled in BPI’s partner schools
- How much you can borrow: Up to your available BPI credit card limit
- Interest rate: 16.22% to 21.11% per year
- Service fee: PHP 300
- How long you can repay the loan: Three to 24 months
BPI credit cardholders may avail of a tuition installment plan[8] using their card. No need to submit any document to the bank or go through a tiring loan application process. The loan can be used to pay not just for tuition but also for other school expenses.
How to Apply for BPI SIP Loan
Simply use your BPI credit card when paying for tuition at a BPI-accredited school. You’ll be billed your monthly amortization over a period of up to 12 months based on your chosen loan term.
Bukas Tuition Installment Plan
Key Features:
- Who can apply: Filipino undergraduate and graduate (masters, doctorate, law, and medicine) students aged 18 and above enrolled in Bukas’ partner schools and with a guardian or guarantor at least 21 years old. Parents may also apply on behalf of qualified students.
- How much you can borrow: Up to 100% of your tuition, laboratory fees, miscellaneous fees, and other enrollment fees
- Interest rate: 1.5% per month
- Fees and charges:
- Service fee: 3% of the loan amount
- Late payment fee: 5% of the overdue amount
- How long you can repay the loan: 12 months
Bukas is an education financing company licensed by the Securities and Exchange Commission (SEC) that provides student loans for college students in the Philippines. Students of Bukas’ partner schools such as FEU, CEU, Mapua University, and Lyceum of the Philippines may avail of a Bukas student loan.[9]
This tuition loan is easy to obtain through an online application with a one to three-day processing time. It’s also flexible when it comes to repayments, as borrowers can start repaying their loan 30 days after application.
Bukas Education Loan Requirements
- School ID
- Tuition/Assessment form issued by the school
- Guardian’s/Guarantor’s valid ID, proof of residence, and proof of income
How to Apply for Bukas Student Loan
Register for an account on the Bukas.ph website (app.bukas.ph/register), complete your profile, and fill out an online application form. You’ll also need to upload an image of each requirement. Wait for a text message from Bukas about your loan approval.
InvestEd Student Loan
Key Features:
- Who can apply: Filipino students 18 years old and above who are enrolled in a university in the Philippines and in their last two years of college
- How much you can borrow: PHP 10,000 to PHP 100,000 (depending on student’s financial need and other factors)
- Interest rate: 27% to 35% per year (2.3% to 2.9% per month)
- Service fee: 22% of the loan amount or PHP 3,000, whichever is higher
- How long you can repay the loan: Customized loan repayment plan based on the student’s needs and financial situation
InvestEd is a social enterprise licensed as a lender by the SEC. It provides four types of student loans for different purposes: tuition payments, gadget purchases (e.g., laptops, tablets, and smartphones for online classes), allowance, and payments for thesis-related expenses.
InvestEd makes education loans more accessible through an easy online application process and customizable payment plans. Student-borrowers may choose to repay immediately or after graduation.
Students approved for the InvestEd education loan also receive digital one-on-one coaching to guide them through repayment and provide them with tips and tools for graduating from college and starting a career. It’s the only student loan in the Philippines that offers a coaching program to borrowers.
How to Apply for an InvestEd Student Loan
Create an account on the InvestEd website and fill out an online application form. Within two to five days, you’ll receive the results of your student loan application.
If you qualify, you’ll undergo a 20-minute phone interview with a loan officer. An InvestED representative will ask you to submit documents such as a valid government-issued ID, proof of address, and proof of academic status.
Once approved, your loan amount will be released via your mobile wallet or bank account. For tuition and gadget loans, the funds are paid directly to the school or equipment supplier/merchant.
How to Apply for a Student Loan in the Philippines
Here are the steps to get an education loan to cover the cost of your tuition and other school expenses.
1. Research on Student Loan Offers
Unlike personal loans and payday loans, student loans are not popular among Filipinos, so it helps do your research on the different Study Now, Pay Later programs available for college students like you.
2. Compare Student Loans in the Philippines
Private lenders and government institutions offer different interest rates. Student loans from the government are inexpensive in terms of fees but may require you to undergo a tedious application process. Sometimes, the struggle is worth the money you can save.
However, there are times when your access to resources limits you to student loans from banks and other private lenders. You should always take time to weigh all your options because practicality cannot be measured by savings alone.
To ensure you won’t be burdened with loan repayments you can’t afford, study each of your options carefully and then compare its features with other student loans.
Particularly, look for these features:
- Low interest rate, low fees, and no hidden charges – These will lower your cost of borrowing.
- Loan amount – Compute how much you need to borrow and check if it’s within the range that the lender is willing to lend.
- Loan term – How soon can you fully pay off your student loan? If you need a long time for repayments, look for a lender that offers a longer term. Consider getting a student loan that allows you to start paying after you graduate or get a job.
3. Ask for a Sample Computation
Whether you love or hate math, you have to compute the monthly installment to know if you (or your parent) can afford it. Check the lender’s website for a sample computation of monthly amortization. If it’s not available online, inquire through the lender’s customer service hotline or social media account.
Compute the cost of the full loan against the loan term, interest rates, and fees. Make sure there are no hidden charges. Applications for most student loans in the Philippines are free. Some fixers may offer to facilitate easy loan applications and may ask for money in return. Beware of individuals who pose as staff of any government agency or private institutions offering the student loan. These may ask for a commission or may even be a total scam.
4. Prepare Your Supporting Documents
Most college students are considered of legal age, but some lenders require the guidance of a parent of an older relative to serve as the guarantor for the loan. Parents may not apply as the primary borrower, but they can be responsible for their children’s unpaid college loans, especially if they consented as a guarantor.
Some documents you should initially prepare:
- Student ID
- Birth certificate
- Parent’s marriage certificate
- Form 137 (High school card)
- Clearance from the previous school
- Certificate of graduation
- Parent’s ID
- Parent’s income tax return (ITR)
5. File Your Student Loan Application
Once you have all the requirements ready, submit your application to the student loan provider. Depending on the lender, you can apply for a tuition loan either online or in-person at the provider’s office.
Tips to Remember When Applying for a Student Loan
Here are some quick tips to help you pick the right student loan plus tips for a faster student loan approval.
Don’t Fall for Loan Sharks
Students are easy prey for illegal lenders because of their lack of knowledge and experience. Never transact with lenders that charge a very high interest rate. Research the company’s background and check if they have a lending license from the SEC.[10]
Maintain a Good Academic Performance
You might think that student loans need to be paid and should not require good grades. Remember that some lenders check borrower’s grades in the previous year to see if they’re capable of focusing on their studies and using the loan for educational purposes only. Your academic performance can also be used to evaluate your sense of responsibility as a borrower.
Check for Legitimate Links and Websites
Almost all transactions can be done online. To protect your privacy and personal information, make sure you’re transacting through a legitimate website. Some fraudsters may not benefit from your loan but may use your identity to make fraudulent transactions.
Talk to Your Parents About the Loan Application
Involve your parents or guardians in your decision-making. If you’re still living with your parents or relatives, discuss your plans of applying for an educational loan in the Philippines with them. Their wisdom and experience can help you make a good decision when it comes to selecting the right school, choosing the appropriate course, and applying for the best student loan with the lowest interest rates.
Even better, consult someone who’s knowledgeable about student loans, such as a lawyer, accountant, or finance professional. Their opinions can guide you through choosing the best loan for you.
Final Thoughts
Student loans are financial aid that can ease the burden of paying for your education. These are a privilege you can grab to secure your future. Don’t let your financial situation stop you from achieving your dreams. Legitimate student loans in the Philippines help students continue their college education and focus on their studies instead of worrying about how to fund their education.
Below is a list of other best personal loan companies and their loan features. Compare your options and apply through Moneymax!
| Personal Loan Provider | Features |
|---|---|
Citibank Personal Loan |
|
| EasyRFC Multi-Purpose Loan |
|
| SB Finance Personal Loan |
|
| TALA Personal Loan |
|
Sources:
- [1] 44,000 college students may be unable to enroll (Philstar, 2020)
- [2] What to Know About Grants for College (USNews, 2019)
- [3] What is UniFAST, and Why Was It Established? (CHED)
- [4] SSS Educational Assistance Loan Program | SSS EALP Application Form
- [5] GSIS lines up 3 new loan programs (Philippine News Agency, 2020)
- [6] LANDBANK I-STUDY Program
- [7] LANDBANK student loan covers gadget purchase for distance learning (LANDBANK, 2021)
- [8] BPI SIP Loan for School
- [9] Bukas Tuition Installment Plan
- [10] SEC List of Licensed Lending Companies and Financing Companies
Venus is the Head of Content at Moneymax, with 15+ years of experience in digital marketing, corporate communications, PR, and journalism. She invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. Outside of work, she’s crazy about cats and Korean dramas. Follow Venus on LinkedIn.
