KUALA LUMPUR – May 16, 2019: It’s not good news at all for the National Higher Education Fund Corporation or PTPTN, for if its current trajectory continues, it would accumulate about RM70 billion of debts by 2040.
Only 49 per cent of borrowers are deemed to be responsible and even then, only 26 per cent of them have completed their repayments. Thirty-two 32 per cent have been paying inconsistently while 19 percent have bothered to pay.
This was the grim report mentioned by the agency’s deputy chief executive (policy and operation) Mastura Mohd. Khalid at the launch of its public consultation paper here today.
The poor repayment records means that as of last year, there were 972,000 defaulters owing RM6.4 billion in arrears.
If the situation continues, the repercussions will be felt mainly by those intending to borrow.
For example, for every borrower who decides not to pay back a RM21,000 loan, three new applicants will be denied a loan. If this continues long enough, there is a high risk the entire student loan facility will collapse.
At the same event PTPTN chairman Wan Saiful Wan Jan said the agency will be turning to the people for feedback to formulate a new repayment scheme that is affordable and sustainable.
The document containing the results and discussions with various stakeholders from last December to March will be put up online for public feedback. The online consultation process is conducted in the form of an online public survey at www.ptptn.gov.my/kertas-konsultasi-rakyat.
Wan Saiful also said that PTPTN may consider asking for the travel ban on defaulters to be reintroduced. The ban was lifted after Pakatan Harapan formed the government last year because it was contained in the coalition’s election manifesto.
According Mastura, more than two thirds of defaulters started to pay back their loans when the ban was enforced.