MCA Youth Secretary-General Saw Yee Fung has called on the government to enforce stricter measures against borrowers who fail to settle their PTPTN (National Higher Education Fund Corporation) loans. She suggested that defaulters be barred from applying for housing and vehicle loans, arguing that current measures, such as overseas travel restrictions, are not strong enough to deter non-payment.
“Only tougher consequences will work,” Saw told reporters.
Launched in 1997, PTPTN provides study loans to Malaysian students pursuing tertiary education, helping millions access higher education over the years. However, official data obtained by NST shows that 417,192 borrowers have defaulted, having missed payments for 12 months or more, collectively owing RM9.55 billion in unpaid loans.
This growing default rate has raised concerns over the scheme’s sustainability, as repayments are essential to fund new students. Saw proposed a payroll deduction system, where repayments are automatically taken from salaries based on income, similar to the monthly tax deduction (MTD) system. She also urged closer collaboration between PTPTN, the Inland Revenue Board (LHDN), and the Immigration Department to strengthen enforcement.
Saw criticised the recent decision by the Deputy Higher Education Minister to lift travel bans for PTPTN defaulters, saying it sends the wrong signal. She added that borrowers who can afford international travel but avoid repayment should not be given leniency, stressing that firm action is needed to maintain public trust in the government’s commitment to the scheme.
