PTPTN to team up with IRB to recover study loans

If the plans go ahead for PTPTN and IRB to team up, then the wage deduction for loan repayment will become a reality soon given that IRB already doing the same to get back tax defaulters.

Defaulting education loan borrowers may be forced to pay up by way of monthly salary deductions.

Higher Education Minister Datuk Seri Mohamed Khaled Nordin said today that the Cabinet had agreed last week to allow the Inland Revenue Board to collect loan payments on behalf of the National Higher Education Fund Corporation (PTPTN).

Next on the agenda for IRB and PTPTN is to discuss the payment mechanism.

"Among the things to be discussed are whether the system should be applied to all borrowers or to the new ones only, when they should start paying and the threshold, which will be based on the salary, as we must also accommodate those with smaller income," Khaled said.

He expected the collection to start next year.

PTPTN chairman Datuk Dr Mohamad Shahrum Osman hit out at those who defaulted on their loan payments, saying they did not care about the future of other people.

"By not paying up, the borrowers are doing a disservice to the nation. They are not contributing to the future of its students," he said.

If borrowers did not pay up, PTPTN's coffers would be depleted and this would reduce the amount of money available for lending to future borrowers.

Dr Shahrum said the defaulters would only take the initiative to approach PTPTN when they wanted the travel ban imposed against them to be lifted.

"When they want to perform the umrah or haj, they come to us," he said.

Others included those who were required to travel overseas for work such as businessmen, pilots and stewardesses.

"But we don't simply blacklist borrowers. Notices (on payment) are sent out and if they are ignored, we will take the borrowers to court. If they ignore that also then we blacklist them," he said.

Dr Shahrum said the number of borrowers had increased as loans were now open to students of independent Chinese schools.

PTPTN has disbursed RM32.4 billion to 1.5 million study loan accounts since it was established in 1997.

As of March, payments were due on 775,942 loans of which RM1.6 billion has been recovered from 563,897 of them. Borrowers who have not started repaying run the risk of being blacklisted.

A total 37,453 accounts were blacklisted from 1997 to March.

NST