As Ptptn Arrears Rise Ag S Report Calls For Stricter Collection Measures

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The National Higher Education Fund Corporation (PTPTN) in 2023 received loan repayments amounting to over RM3.5 billion, representing 32.7 percent of the over RM10.8 billion in arrears.
The Auditor-General’s Report 1/2025 on the Federal Agency Financial Statements for 2023, tabled in the Dewan Rakyat today, showed that outstanding education loan repayments increased from 2019 to 2023.
Consequently, the report proposed that PTPTN adopt enforcement measures approved by the cabinet on July 5, 2024. These measures include sending reminder letters, taking enforcement actions, issuing demand notices, filing lawsuits, and obtaining court judgments.
The report recommended that PTPTN revise its loan repayment collection methods to enhance effectiveness and improve loan management monitoring by implementing targeted collections based on the duration of arrears.
This would ensure that PTPTN does not rely on financial institution loans to function, the report said.
It also recommended reviewing the repayment discount incentives and the 100 percent loan repayment exemption for borrowers who graduate with first-class honours or an equivalent qualification, ensuring it is provided only to targeted and eligible borrowers.
The report added that the highest outstanding education loan repayment amount was recorded in 2023, reaching over RM10.8 billion, involving 1.2 million borrowers. In contrast, the lowest amount was registered in 2018 at over RM6.3 billion, involving about 970,000 borrowers.
The report said loan repayments from 2014 to 2023 totalled over RM26.4 billion, encompassing more than 106 million transactions. The repayment methods utilised included salary deductions, direct debit, Employees Provident Fund withdrawals, as well as payments made at the counter and online.
“The highest number of repayment transactions was recorded through payments made at the counter and online methods (62.38 million transactions), followed by salary deductions (23.84 million transactions)," the report said.
The report found that loan repayment percentages by PTPTN from 2014 to 2023 varied between 7.3 percent and 79.3 percent in relation to the outstanding education loan amounts.
“The analysis indicates that loan repayment collection peaked in 2017 at nearly RM5.2 billion (79.3 percent), whereas it was lowest in 2014 at RM717 million (7.3 percent),” the report said.
The report said the highest repayment collection in 2017 was due to strict enforcement measures, such as blacklisting defaulters in the Central Credit Reference Information System and mandatory salary deductions for public sector employees.
“However, these enforcement measures were discontinued in 2018, leading to a decline in repayment collections from that year onward,” the report added.
As of Dec 31, 2023, the total remaining loan balance was recorded at over RM43.6 billion after factoring in both reductions and additions in loans for the year.
Additionally, the report said the federal government bore the funding cost of PTPTN loans or sukuk amounting to about RM8.3 billion from 2019 to 2023. It also accounted for about RM1.2 billion in repayments for the Loan Repayment Discount Incentive and Loan Repayment Exemption Incentive during the same period.
It was reported that PTPTN, the Fundamental Research Fund, and the Solid Waste and Public Cleansing Management Corporation are among the key audit focus areas in the Auditor-General’s Report 1/2025.
These areas represent one of three main focus issues, including Financial Statement Verification and Financial Statement Analysis.
- Bernama

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