Breaking a scholarship bond: what it really costs

If you break a Singapore government scholarship bond, you have to pay back the value of the scholarship, reduced for the years you’ve already served. Government has said so plainly in a written answer to Parliament in February 2025. Many bonds add compound interest on top. The one formula that’s published in full, for MOE’s Tuition Grant, charges 10% a year, compounded.

So the honest answer is: it’s the full cost of your education, minus credit for time served, possibly plus interest depending on your contract. For an overseas degree, that’s a six-figure sum.

I’ve never had to break a bond, because I turned down the two I was offered. But the time to run these numbers is before you sign, not after.

What actually happens when you break a bond?

You stop serving, and the sponsor sends you a bill called liquidated damages (LD). That’s a sum agreed in your contract up front, so nobody has to go to court to work out what you owe.

Here’s what the official sources say about it:

Look at the hole in that table. The big uniformed and public-service scholarships don’t post their interest rate online. It’s in your scholarship agreement.

You’ll read “10% compound interest” on lots of blogs as if it’s universal. It might be true for your scholarship. But I couldn’t find PSC or MINDEF saying so in public, so I won’t tell you it’s fact. Read your own contract.

How much would I actually owe? Two worked examples

The bill has three parts: what was spent on you, minus credit for years served, plus any interest.

“What was spent on you” is usually more than tuition. The PSC Scholarship, for example, covers tuition fees, maintenance allowances, return airfare for overseas study and development programmes. Expect all of that to show up on an itemised bill.

Example 1: the one formula that’s fully published (MOE Tuition Grant)

This applies to Singapore PRs and international students. Singapore citizens don’t serve a Tuition Grant bond, but PRs and international students serve 3 years. It’s useful for everyone because it’s the clearest public LD formula I could find.

Say a PR studies Humanities and Sciences at NUS, starting in AY2026/27. From NUS’s fee table:

• Fee with the Tuition Grant (PR): S$11,600 a year
• Fee without it: S$36,650 a year
• Gap: S$25,050 a year

MOE says the bill is the Tuition Grant you received, plus any GST subsidy, plus 10% interest a year. I’m treating that S$25,050 gap as the grant plus GST subsidy. Your exact figure is in your own TG agreement.

Over a 4-year course, that’s S$100,200. Now add MOE’s 10% a year, compounded at the end of each academic year. I’m assuming interest runs from the end of each year until you graduate:

So walking away at graduation turns a S$100,200 grant into a bill of about S$128,000. That’s for a local degree with modest fees.

Example 2: an overseas degree, before interest

Now scale it up. Oxford publishes its overseas fees as a range. For 2026 entry, overseas course fees run from £37,380 to £62,820 a year, depending on the course, and Oxford estimates living costs at £12,645 to £18,945 for nine months (Oxford fees and funding booklet, 2026 entry). I’m using the published range, not one course’s fee. Your course’s exact figure is on Oxford’s course-fees page.

Over a three-year degree, that’s:

• Tuition: 3 × £37,380 to £62,820 = £112,140 to £188,460
• Living: 3 × £12,645 to £18,945 = £37,935 to £56,835
• Total: about £150,000 to £245,000, before flights, allowances, programmes, fee rises or interest

Break the bond on day one of work and that’s roughly your starting point. Add whatever interest your contract specifies. Then subtract credit for any years served.

Is the amount reduced if I’ve served part of the bond?

Yes. The February 2025 answer says repayment takes into account the number of years served. How the reduction is calculated (straight pro-rating by months, or something else) is in your contract, not online.

The cheapest time to leave is near the end. The most expensive is right after graduation, when interest has had the longest to build and you’ve served nothing.

Can I pay in instalments, or does my family have to pay?

It depends on your agreement, and the big agencies don’t publish this. Some bonds name sureties, usually family members, who sign the contract with you. At NTU, sureties are jointly and severally liable. That means the sponsor can chase any one of you for the whole amount.

That’s the part people forget when they sign at 18. Your parents may be signing too.

How common is breaking a bond?

Rare. Government agencies awarded about 4,500 scholarships between 2014 and 2023. On average, 10 recipients a year broke their bond during their studies, and 14 a year resigned before finishing it.

That’s roughly 24 people a year out of about 450 awards. Most scholars serve their bonds. Some love it. The point isn’t that breaking is common. It’s that the people who do it usually didn’t plan to.

Is breaking a bond worse than just taking a loan?

Usually, yes. That’s my main point.

Compare the two paths for someone who isn’t sure about the public service:

The worst strategy is “take it and see”. If you’re unsure, you could end up paying more than a loan would have cost. And you’d also spend years in a role you didn’t want.

My test is the day-one exit price. Before you sign, write down the LD you’d owe if you quit on your first day of work. If you can’t stomach that number, you need to be certain you’ll stay. If you’re not certain, the bond is the expensive option.

Still deciding whether to take a bond at all? That’s a different question, and I cover it in should you take a bonded scholarship?.

What I’d ask before signing (or before breaking)

Ask your sponsor, in writing:

1. What’s the interest rate on liquidated damages, and how is it compounded?
2. Exactly what’s included: tuition, allowances, flights, programmes, internship pay?
3. How is credit for years served calculated?
4. Can I pay in instalments?
5. Who are the sureties, and what are they liable for?
6. If I want to leave, can I move to another agency instead of breaking?

If you’re already thinking of breaking, ask for an itemised LD statement before you resign. Don’t guess.

Do university and corporate scholarships work the same way?

Not necessarily. If your scholarship is from a university, check whether it has a bond at all. Many don’t. If you’re a Singapore citizen on the MOE Tuition Grant only, there’s no TG bond for you. And corporate scholarships set their own terms, so read those contracts separately.

Next:

• Should you take a bonded scholarship? Advice from someone who turned down two
• How to pay for university without a scholarship
• Scholarships in Singapore: the honest map
• All my scholarship guides