Master Escrow Agreement
What is a Student Tuition Fee Account (Escrow)
Tuition fees paid by the students to the PEOs will have to be left in the custody of a third party, in this CASE the CASE-endorsed banks participating in the Student Tuition Fee Account (Escrow) scheme. When specified conditions for its release have been met, the banks will disburse the tuition fees on a regular basis to the PEO.
Tuition fees paid by the students to the PEOs will have to be left in the custody of a third party, in this CASE the CASE-endorsed banks participating in the Student Tuition Fee Account (Escrow) scheme. When specified conditions for its release have been met, the banks will disburse the tuition fees on a regular basis to the PEO.
How does the Student Tuition Fee Account (Escrow) work?
CASETrust and the providers of the Student Tuition Fee Account (Escrow) (DBS and HSBC) have signed a Master Escrow Agreement (MEA) (for MEA, please download Full Information Kit and refer to Annex B) which sets out the rules governing the operation of all escrow accounts opened by the PEOs with the providers. The PEOs who wish to participate in this escrow scheme will have to sign on to the MEA.
When a PEO signs on to the MEA, the bank will arrange to open a Student Tuition Fee Account (Escrow) for the PEO. The PEO is to ensure that the tuition fees of its students will be paid directly into this account. The tuition fees in the Student Tuition Fee Account (Escrow) will be held on trust by that PEO for the benefit of the students.
When a PEO signs on to the MEA, the bank will arrange to open a Student Tuition Fee Account (Escrow) for the PEO. The PEO is to ensure that the tuition fees of its students will be paid directly into this account. The tuition fees in the Student Tuition Fee Account (Escrow) will be held on trust by that PEO for the benefit of the students.
Thereafter, prior to payment of the tuition fees, the PEO will have to issue a prescribed form (Payment Voucher – Schedule 6 of MEA) to the student stating the details of the tuition fees to be paid for the particular instalment. This Payment Voucher is to be submitted to the bank along with the student’s tuition fees payment.
The bank shall disburse the tuition fees in the Student Tuition Fee Account (Escrow) to the PEO in accordance with the payment schedule.
Under what circumstances will the Student Tuition Fee Account (Escrow) scheme be suitable for PEOs?
The Student Tuition Fee Account (Escrow) scheme is suitable for PEOs that want a solution to help them reconcile their student fee payments. It is also suitable for PEOs that do not qualify for the Student Tuition Fee Insurance scheme.
What types of fees will need to be paid to the Student Tuition Fee Account (Escrow)?
Only the tuition fees have to be paid into the Student Tuition Fee Account (Escrow). Tuition fees means the gross payment (before any commission may be deducted) relating to all costs of a course paid by an international student.
Other fees such as accommodation expenses, examination fees and administrative fees do not have to be paid into the Student Tuition Fee Account (Escrow).
When and how will the tuition fees in the Student Tuition Fee Account (Escrow) be paid to PEOs?
The tuition fees in the Student Tuition Fee Account (Escrow) will be released to a PEO as follows: a. Initial 30% of the tuition fees – to be paid by the 5th business day after commencement date of course.
Balance 70% of the tuition fees – to be paid in equal monthly instalments over duration of course on the 1st day of each subsequent calendar month.
Can the students pay their tuition fees directly to the PEO or into the PEO’s bank accounts and the PEO then remits the tuition fees to the Student Tuition Fee Account (Escrow)?
No. The PEOs are not allowed to accept direct payments of the tuition fees of the students. These tuition fees must be paid directly into the Student Tuition Fee Account (Escrow).
What modes of payment are accepted for crediting funds to the Student Tuition Fee Account (Escrow)?
Payment may be made by:
- Cheque
- Cashier’s order
- Bank draft
- Telegraphic transfer
Additional modes of payment may be available, depending on the banks.
Will the PEOs have to change their existing structure for the payment of the tuition fees by the students?
Yes and no.
Yes because:
- Payments will have to be via the modes set out in Q7 above. The PEOs will not be able to accept payment of the tuition fees of the students by way of cash, credit cards or GIRO.
- The PEOs will need to issue a Payment Voucher to an international student each time he/she makes payment of the tuition fees, which is to be submitted to the banks at the time of payment.
No because the PEOs can still continue with their existing schedules for collecting tuition fees from the students, be it by way of one or more instalments.
How will the students know they have to pay their tuition fees into the Student Tuition Fee Account (Escrow)?
All students will have to sign a Student Escrow Confirmation form at the outset when they apply to enrol in a PEO that is participating in the Student Tuition Fee Account (Escrow). This Student Escrow Confirmation form will state that the student agrees to be bound by the terms of the MEA and will pay their tuition fees, in accordance to the payment schedule, directly into the Student Tuition Fee Account (Escrow).
How do the PEOs know whether the students have paid their tuition fees into the Student Tuition Fee Account (Escrow)?
The PEOs will be given reports setting out the tuition fees paid into the Student Tuition Fee Account (Escrow). The reports will contain a breakdown of these tuition fees (with sufficient details to identify the students and the courses for which the tuition fees are paid) for reconciliation and audit.
What happens when there is a shortfall in the tuition fees paid into the Student Tuition Fee Account (Escrow)?
When there is a shortfall in the tuition fees paid into the Student Tuition Fee Account (Escrow), this will be reflected in the reports sent to the PEO.
What happens when there is a dispute between the PEO and the international student regarding the tuition fees paid into the Student Tuition Fee Account (Escrow)?
The PEO or the international student shall refer the dispute to CASE Mediation Centre for mediation with the aim to resolve the dispute amicably.
Can the international students ask the banks to refund them the tuition fees in the Student Tuition Fee Account (Escrow)?
No. The bank is only entitled to release the tuition fees from the Student Tuition Fee Account (Escrow) in the following two situations:
- For payment to the PEOs in accordance with the terms of the MEA (please see Q5);
- For payment to the students in accordance with the instructions issued by CASE in the events of PEO’s insolvency, regulatory closure or failure to pay penalties/fines awarded by the Singapore courts to the student.
What are the charges for Student Tuition Fee Account (Escrow)?
The charges and fee structure may differ between the banks endorsed by CASE. Please refer to their respective product brochures for information on charges.
Will there be interest paid on the tuition fees in the Student Tuition Fee Account (Escrow)?
As stated in the MEA, the Student Tuition Fee Account (Escrow) is a non-interest bearing account. As such, no interest will be paid on the tuition fees in the Student Tuition Fee Account (Escrow).
Will the bank be able to provide the PEO financing to bridge the PEO’s cashflow requirements?
The banks will be available to discuss the PEO’s financing requirements. Contact information can be found on CASE website.
How does a PEO apply for the Student Tuition Fee Account (Escrow)?
The application procedures differ between the banks endorsed by CASE. Application procedures and contact Information can be found in Annex B3 (DBS) and Annex B4 (HSBC) of the Full Information Kit, downloadable from CASE website.
How will the PEO prove that it has established a Student Tuition Fee Account (Escrow) under the CASE-endorsed Student Protection Scheme?
Submit the following documents to CASE:
- Original PEO Accession letter;
- Original Certificate of PEO Escrow Establishment.
Is there any additional document to be submitted to ICA for the Student’s Pass application for a student enrolled onto Student Tuition Fee Account (Escrow)? What is the Form of Acknowledgement of Student Escrow Confirmation for?
With effect from 1 Dec 2004, the Form of Acknowledgement of Student Escrow Confirmation needs to be included, as documentary proof of Student Protection Scheme, during the Student’s Pass application submitted to ICA. Form of Acknowledgement can be found in Full Information Kit, Annex D1.
What happens if the student pays the tuition fees in advance and the student’s pass is rejected?
The fees credited to the Student Tuition Fee Account (Escrow) will be refunded in full (less bank charges) to the student according to the student details provided in the Student Escrow Confirmation. The PEO will need to submit the Rejection Refund Letter (Schedule 8 of MEA) to the bank.
Click here to view the Master Escrow Agreement Document.
