From borrowing to saving — PTPTN on a transformation mode

PTPTN wants to be better known as an educational fund instead of the education loan provider


THE National Higher Education Fund (PTPTN) is on a mission to “recalibrate” its functions and reputation from being a loan provider for education to promoting savings products for the public.

The fund’s chairman Wan Saiful Wan Jan said while repayment issue may have been one of the fund’s biggest challenges, PTPTN is returning to its core mission — to have more people to save for education purposes.

“In this case, it’s all about encouraging saving. I really want to change how people view PTPTN. At the moment, whenever people think of PTPTN, they will relate it to borrowing.

“That has to change. We want to be associated with saving, just like how people would relate Permodalan Nasional Bhd with Amanah Saham Bumiputera,” he said.

Wan Saiful said awareness for the fund’s matching grant scheme and other saving initiatives is still relatively low.

However, he is optimistic that PTPTN would be able to re-establish itself and restore the public’s confidence through the right mechanism and working co-operation.

Wan Saiful recently shared his ideas and plans for PTPTN in the coming years during an exclusive interview with The Malaysian Reserve.

We are hoping that through various SSPN programmes, we will be able to disseminate this information to the B40 group, says Wan Saiful

What’s the cause behind low take-ups for PTPTN’s matching grant? Is it due to the lack of awareness, or is the policy taking a back burner due to the change of prime ministers since early 2000s?

One of the special benefits of SSPN-i (Skim Simpanan Pendidikan Nasional) that many Malaysians may not be aware of is a matching grant of up to RM10,000 per qualified family. It was announced by Prime Minister Tun Dr Mahathir Mohamad when he tabled the 2003 budget on Sept 20, 2002. The government had allocated RM1 billion in the form of matching grant as a special incentive to the low-income group who had savings in SSPN-i.

Unfortunately, Dr Mahathir left the office at the end of 2003 and the scheme was gradually forgotten. The emphasis after that period by PTPTN under the previous regimes was on lending, or loans instead of promoting saving. That created the borrowing culture.

I think the message was clear that he wanted the people to save. So, when we checked the grant we realised we have RM997.5 million left for the scheme. So, we are reviving that campaign, reminding the whole country that the scheme is available.

Again, as much as I’m hoping that the lower-income group would save as much as they can, what would be really helpful is if companies, private foundations, even state governments and government agencies could incorporate this scheme to assist the lower-income group, so they can have SSPN products as one of the incentives they can put money into.

As of July 31, 2019, a total of RM2.4 million was given free to 1,726 depositors with a total of 1,854 accounts. The take-up rate of this incentive is too small as the grant that has been allocated by the government is a lot more.

This may be due to the lack of awareness among those in the bottom 40% (B40) income bracket as they are more focused on borrowing compared to saving for their children’s higher education.

Currently, PTPTN has shifted its focus from providing education loans to promoting savings products, and wants to be better known as an educational fund instead of the education loan provider.

Therefore, the PTPTN programmes now focus more on savings products like the SSPN rather than the PTPTN education loan. We are hoping that through various SSPN programmes such as Jelajah SSPN and Minggu Menabung SSPN, we will be able to disseminate this information to the B40 group, so that they can seize this opportunity.

The objective is to inculcate a saving habit among Malaysians especially the B40 group. We want them to realise that saving is revenue and borrowing is an expense.

How does it work? Will PTPTN consider expanding the minimum amount of income to reach a wider base?

The incentive provided by the government during Dr Mahathir’s earlier leadership was with a clear intention — to help the lower-income group, provided that they make the initiative to start saving first. In fact, by making an initial saving of RM20 in the SSPN, the B40 group will be automatically entitled for an instant free token of RM100 credited to their account.

While the B40 group enjoys the matching grant incentive, the high-income group is also not left behind.

They can enjoy a tax exemption up to RM8,000 yearly based on their yearly net deposit in SSPN-i. Clearly, SSPN-i caters both the low- and highincome groups.

It may seem impossible to encourage savings when the lower-income group could barely make ends meet, so how is the scheme going to work?

I fully accept that we need to think of ways to market the incentive. Now we are at the awarenessraising stage because the people have forgotten about it.

We are telling everyone that the scheme exists. I’m willing to talk to companies, foundations, charity foundations, and religious and zakat departments. In case they want to have a special programme for the poor, they can maybe have a partnership with us.

We have been talking to the state governments of Kedah, Melaka, Penang, Negri Sembilan and Sabah. We have visited the chief ministers and Sabah state excos. We will continue to have meetings with them at the state government level. Hopefully, they’ll use the grant as well.

A collaboration signing ceremony between PTPTN and was held at the Kuala Lumpur Convention Centre on Aug 29 this year. Finance Minister Lim Guan Eng (centre), Wan Saiful (second from right), and NCCIM president Tan Sri Ter Leong Yap (second from left) were at the ceremony to witness the exchange of documents between PTPTN deputy CEO Mastura Mohd Khalid (left) and Malaysia country manager Gan Bock Herm (right)

What is the update on the consultative study regarding repayment mechanism?

The outcome of the Public Consultation Paper was analysed and presented to the Ministry of Education. The proposed new loan repayment policy will be presented to the Cabinet in the future and will be announced for implementation once approved.

Considering many issues at hand, political or otherwise, what should be the best way to address repayment issues?

The issues of PTPTN loan repayment are often discussed by several parties. Once the loan is due, the borrower will have to make a repayment. That is the basis for all loans.

However, there are a number of things that the government is currently looking at to make PTPTN repayment more efficient without ignoring human rights. The Public Consultation Paper was published for all Malaysians to give ideas and opinions on the implementation of the new repayment policy.

The main focus of PTPTN as an educational fund at the moment is not only to give loans but to encourage a culture of saving rather than borrowing. Saving in SSPN for educational purposes is the best approach to prevent students from being burdened with debt repayment when they graduate.

What is the status of discussion with the Housing Ministry to allow defaulters to own a house? Is PTPTN looking at debt consolidation as one of the methods?

PTPTN is constantly working with developers such as PR1MA (Perumahan Rakyat 1Malaysia) to facilitate PTPTN borrowers in obtaining housing loans.

To assist borrowers, PTPTN provides a loan repayment restructuring facility in order to ensure that PTPTN borrowers are able to make payments based on their affordability. Thus, the CCRIS (Central Credit Reference Information System) record will be good and they can make a housing loan or other loans.

Recently PTPTN has announced a cooperation with What is the aim and does PTPTN have any number of targeted participants in the near future?

As the leader in education loan provider, PTPTN is aware of the difficulties faced by PTPTN borrowers to find a job.

A collaboration has been made by PTPTN with The National Chamber of Commerce and Industry of Malaysia (NCCIM), Sdn Bhd and Department of Labour Peninsular Malaysia. The objective of this collaboration is to help PTPTN borrowers to find job opportunities and build better careers, thus improving their loan repayment performance.

The cooperation with the agencies is deemed as a corporate social responsibility as it is outside the functions of PTPTN. We hope that borrowers will take this opportunity especially those who have not paid their PTPTN loan or have been paying religiously.

How will this work and what is the mechanism in place?

MyJobs under NCCIM is a platform for employers to promote job vacancies as well as channels for the public, especially PTPTN borrowers looking for job opportunities. The platform will help build a database of job applications that can be used especially by NCCIM members to meet the need to find candidates to fill vacancies. 650,000 employers who are members of the NCCIM are expected to benefit from this collaboration. is a popular job search portal in Malaysia with 90,000 employers registered locally and abroad. The microsite created for PTPTN provides the job search functionality and free services are also provided to PTPTN borrowers in terms of learning modules such as interview preparation, basic soft skills learning, resume preparation and many more. also provides a question-and-answer session by officials and industry employers to PTPTN borrowers who are interested in learning additional skills through PTPTN’s Facebook live webinar application.

PTPTN held the ‘Jelajah Skim SSPN 2019’ programme in Melaka on Sept 22 this year

Will this be expanded to other job search platforms and in rural areas?

JobsMalaysia under the Department of Labour Peninsular Malaysia is the platform of job search system. The platform is able to shorten job search processes, especially for borrowers in rural areas as coming to the city centre in person for information and find a job requires a longer time and energy. In addition, PTPTN is given the priority to participate in every job and career fair held by JobsMalaysia in each state to assist PTPTN borrowers.

Budget 2019 stated that employers will enjoy the incentive for tax relief. Can you explain what types of employer can enjoy this incentive and what are the conditions?

All employers — referring to a registered business including a sole proprietorship — who conduct business and pay taxes under the Income Tax Act 1967 are eligible for this incentive. The conditions for this incentive are: Employers pay back PTPTN loans on behalf of employees; employees’ job status is full time and employees should not be charged in return for PTPTN loan repayment by their employer.

Is there a certain amount for an employer to make a repayment?

There are no minimum and maximum amounts for an employer to make repayment. The employer is entitled to the tax relief based on any amount of repayment made, within the period of Jan 1, 2019 to Dec 31, 2019.

The employer would get an unlimited tax relief. Can you please explain further?

For example, if an employer helps pay back his employee’s PTPTN loan amount of RM50,000, then the employer is entitled to the same amount for tax relief. The tax relief given is based on the amount that has been paid. There is no limited amount for that. This will benefit both sides.