1. Should I borrow from PTPTN?
The answer in short is yes. PTPTN interest rates are astoundingly low as compared to study loans offered by other banks or credit facilities. Furthermore, approval rates are high and a sure way to lighten some of that burden on your parents back.
2. Should I settle payments earlier?
The latest PTPTN interest is calculated using a 1% flat interest rate. Let say your loan amounts to RM50,000, payable in 15 years. Using the Personal Loan settlement calculator, you will see that the savings you get for settling your loan in full is actually under 1% per year. You are better off dumping that cash in an FD account where your yield is between 3-4%.
But sometimes, you can get benefits if you pay early because the government occasionally offers discounts for early repayment. Like recently, under Budget 2024, the government offered a 10% discount on the remaining loan balance for full settlement of the loan and for paying at least 50% of the remaining balance in a single payment.
3. Can I apply for PTPTN if I am on a scholarship or sponsorship?
If you are under an automatic tuition fee discount (including 100% waiver) by your university, most likely you are still eligible for a PTPTN loan. However, if you fall under a third party sponsorship program, there might be special clauses in the scholarship agreement that might state otherwise.
If you need solid confirmation, you can always refer to your university office or the officer in charge to clear out the terms and conditions.
4. Is there any way I can be exempted from PTPTN repayment?
Yes! You can get exemption if you graduate with first class honours in your degree. If you already have your fees waived by the university and you still graduate with first class honours, your total prize will be the savings on tuition fee plus the PTPTN loan.So, why not make this your motivation to study harder?
The criterias for PTPTN exemptions are:
a) PTPTN loan beneficiary has attended full-time course.
b) Beneficiary has completed their studies within the period as stated in the financing agreement. If you achieved a CGPA of 4.00 but extended your term for even one semester, you will not be eligible!
c) PTPTN financing does not overlap with other sponsorships.
d) Financing recipient must submit the complete application within twelve (12) months from the date of the convocation.
e) The course attended has been accredited by MQA
For those who couldn't care less about grades, take caution. Score a CGPA below 2.0, your PTPTN will be revoked forever! Better to just aim for that first class honours.
5. What problems will I face if I default on my repayment?
PTPTN borrowers will be blacklisted if they fail to make any payments after several reminder notices. This will result in PTPTN defaulters being restricted from leaving the country and renewing their passports. The latest figure of PTPTN defaulters who are in the travel blacklist amounts to over 85,000.
Additionally, the government has also warned that PTPTN defaulters might be blacklisted under CCRIS. This might affect your credit ratings should you wish to obtain a housing loan in the future.
We highly recommend that regular consistent payments are made to avoid having your name blacklisted. Its definitely worth the effort.
Learn more about The Real Consequences Of Not Paying Back Your PTPTN Loan!
6. Are there any other benefits of opening an SSPN account other than for PTPTN application purposes?
Parents who deposit money on behalf of their children into their SSPN account can enjoy tax relief incentives of up to RM6,000 based on the net amount deposited in a year. If their parents file separate assessments, they can enjoy up to RM6,000 tax relief each and if the parents file for joint assessments, they can enjoy joint tax relief of RM6,000.
Don’t Forget to Settle your debt
The mission and objective for PTPTN is applaudable and welcomed. However, it is crucial that the system remain sustainable for future generations to come. Defaulters of loans can make it hard for future borrowers and risk being blacklisted. So do yourself and the future generation a favour by being a responsible payee. It goes a long way for those who need them.
*The above article is intended for informational purposes only. Loanstreet accepts no responsibility for loss that may arise from reliance on information contained in the articles.
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