The National Higher Education Fund Corporation (PTPTN) was established in 1997 for the sole purpose of providing student loans to those who wish to pursue higher education.
Truly, the PTPTN Student Loan is a blessing for many Malaysians as it allows them to pursue higher education without worrying about the cost of their studies.
However, since then we have also seen too many Malaysians shirking their responsibilities to repay their loans, which has affected PTPTN’s ability to pursue its goal. In fact, to date, PTPTN has more than 40 billion RM in unpaid loans.
One thing you need to understand about the PTPTN is that it is a revolving loan program, which means it relies on payments from current borrowers to provide loans to prospective future students.
This means that when we default on our PTPTN repayments, we are actively sabotaging a prospective student’s prospects of getting a PTPTN loan.
Therefore, it is in the best interests of all Malaysians to start repaying our PTPTN loans as soon as possible.
How to start repaying your PTPTN loans
However, that doesn’t mean that paying off your PTPTN loan is something you can do without thinking about it first.
This is especially true for people who have missed a lot of payments before and are not sure how to start or continue paying their PTPTN loans.
So, to help you pay off your loan more efficiently, here are three steps you can take.
1. Restructuring your loan
If you’ve been delaying your PTPTN repayments for a while, the first thing to do is restructure your PTPTN loan.
But wait, what is restructuring? How it works? And how does it help you pay off your debt?
Before we can answer all of these questions, let’s take a look at the most common scenario that occurs when a person graduates:
Twelve months after his graduation date, Ali’s PTPTN repayment period begins regardless of his employment status. As Ali has no income, he cannot start repaying his loan, and the unpaid debt continues to grow with each missed repayment.
Six months after the start of his repayment period, Ali finds work as a cashier in a supermarket. He decides to start making his PTPTN refunds but is shocked when his payment is rejected. He was unaware that he would be asked to settle his overdue payments as a lump sum before he could continue to repay his loan.
Ali does not have enough savings to settle the outstanding amount and therefore continues to miss his PTPTN repayments.
This is where restructuring can help. By restructuring your loan, you can add your arrears to your total loan amount, which means you don’t have to pay your total arrears amount, but you can start your monthly repayments.
By restructuring your loan, you are effectively renegotiating the terms of your loan. This includes the amount of your monthly repayments and the period of time you will need to pay off your loans in full.
Here’s an example of how restructuring works:
Ali has a PTPTN debt of RM32,000 and would like to pay it off in nine years; he also has a debt of RM3,000 resulting from the unpaid repayments to date. Without restructuring, he would first have to settle the arrears with a personal loan or credit card. In this case, he opts for a personal loan with an interest rate of 10% and a term of five years.
In this case, its refund would look like this:
|Total interest paid||RM 2,880.00||RM824.47||RM3,704,47|
|Principal amount||32,000 RM||3,000 RM||35,000 RM|
|Interest rate||1% per year||10% pa||–|
|Mandate||108 months||60 months||–|
|Monthly payments||RM322.97||63.74 RM||RM386.71|
In total, Ali’s initial debt of RM32,000 ended up costing him a total of RM38,704.47.
On the other hand, Ali could also meet with PTPTN to restructure his debt to an amount he can afford to pay. After the restructuring, he will settle the full amount within 10 years (instead of the original 9 years) and will only need to pay RM 500 for the unpaid portion of his outstanding loan (arrears) to start the restructured repayments. .
|Total interest paid||3,200 RM|
|Principal amount||32,000 RM|
|Interest rate||1% per year|
|New mandate||120 months|
|New monthly payments||RM293.34|
After the restructuring, Ali’s total repayments will now be only RM 35,200 (RM 32,000 + RM 3,200 + RM 500).
Another question you might ask yourself is, what if you can’t afford to pay RM500 on your arrears? Don’t worry because the amount you have to pay for the arrears is negotiable. With the restructuring, Ali not only has more time to settle his debt, but he is able to do so with lower monthly payments while paying less in the end.
All you need to do is visit any ATM or PTPTN office near you and discuss the loan restructuring terms in person.
2. Use direct debit to pay off your loan
Between your car loan, your electricity, water and phone bills, there are sometimes too many things to watch out for that you might forget to pay off your PTPTN loan.
That’s why our next strategy is to simply set up a direct debit payment to pay off your PTPTN loans. With direct debit payment, you can rest easy knowing that your payment will be made automatically every month, so you don’t have to worry about missing another payment.
But how do you set up your direct debit payment? Here are the steps to follow to set up your direct debit payment.
i) First, log into your PTPTN account at this connect.
ii) Then click on the “Penyata Baki Terperinci ”
iii) Then you will be taken to a page where you can see your loan details and the balance you owe. From there, scroll down and click on the “Pendaftaran untuk direct debit” button.
iv) And finally, just fill out the application form.
Once your application is approved, your PTPTN loan repayment will automatically be deducted from your bank account.
3. Make additional refunds if you have some cash on hand.
Now that you’ve restructured your loan, and set up your direct debit, all you have to do is look forward to the day your PTPTN loan is fully paid off.
But, if you want to pay it back faster, you can always make additional payments whenever you have extra cash.
How can you do this? Simple. All you need to do is go to the nearest ATM or PTPTN office and chat with the agent at the counter about your additional payment and your balance after the additional payment.
Additional repayments can help you slowly but steadily shorten your loan term, which helps you pay off your PTPTN debt much faster – and could even lower your total interest payments.
Now that you’ve learned all the steps to make your PTPTN loan settlement easier, don’t wait any longer and quickly apply what you’ve learned to pay off your PTPTN loans.
After all, PTPTN is a revolving loan program, which means that the amount you repay will also help other students who need financial help with their tuition fees!
Why you should pay off your PTPTN loan
How to apply for a PTPTN loan?
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