ALTHOUGH it was appalling to many Perak youths that 400,000 people had defaulted in repaying their National Higher Education Fund Corporation (PTPTN) loans, they, at the same time, asked the Government not to be too harsh on them.
Their failure to pay up, they said, was partly due to the high loan administrative charges, among other valid reasons.
The youngsters also made suggestions such as having automatic deduction from the salaries of borrowers.
Postgraduate student Aveyn Toh, 23, said there was a need for students to understand that getting a PTPTN loan was like getting a bank loan.
“You cannot just not pay your PTPTN loan and expect to get away with it.
“When the Government introduces a penalty for PTPTN errant borrowers, it is well within its right to do so,” she said.
Nevertheless, Toh said the administrative charge imposed on PTPTN loans was slightly on the high side for fresh graduates despite it being lower than bank loan interests.
“The charges, which can go up to 3% of the remaining balance, can be a burden for fresh graduates who have to support themselves while trying to save enough for their first car or home.
“Despite that, the loans still have to be repaid and I think it would be good for the corporation to immediately deduct the repayments from the graduates’ salaries or Employees Provident Fund once they start working.
“Most importantly, every student should be made to attend a talk on the PTPTN loan and its repayment scheme before applying for the loan, as I believe most students would not have handled their own money before that and would have no idea how loans work,” she said.
Information technology student Asyraf Mohd Hamsi, 23, said the Government should bring the errant borrowers in for a consultation session before taking action against them.
“They should decide on the course of action on a case-on-case basis.
“Not everyone chooses not to pay their loans on purpose; they might be facing financial difficulties or accidentally flouting the repayment terms and conditions.
“It is better to counsel them and give them financial consultation instead of punishing them senselessly and putting them further in debt,” he said.
Asyraf also adviced students to seek loans from other organisations instead of viewing the PTPTN loan as the only available choice.
“For example, I am currently funding my diploma studies through a study loan from the state government, which has almost identical conditions to the PTPTN loan with a few exceptions, such as the lack of administration charge,” he said.
Cashier Nor Intan Suriati Nor Azman, 23, said the Government should relax the rules to blacklist PTPTN loan defaulters from travelling overseas.
“A blanket ruling like the blacklist is too harsh on errant borrowers, who might need to travel overseas for family obligations such as death or sickness.
“They should also allow graduates to work overseas, provided they show an offer letter and make arrangements for the PTPTN loan repayments to be deducted from their salaries,” she said.
Upper Six student Hone Wai Onn, 19, said the corporation could also consider lowering the loan administration charges.
“Even with degree qualifications, the job market is difficult to get into these days, and the starting pay for graduates can be quite low due to the competition.
“Thus, by reducing or doing away with the administration charges, the monthly instalments would be more affordable for the cash-strapped graduates, allowing them to repay the loans without eating too much into their other finances,” he said.