PETALING JAYA: Removing the travel ban on National Higher Education Fund Corporation (PTPTN) defaulters is a fair move, according to a finance and banking expert.
Dr Nurul Shahnaz Ahmad Mahdzan, an associate professor at Universiti Malaya’s Finance and Accounting Faculty, said taking away such “punishment” would allow them to seek better job opportunities.
“The removal (of the travel blacklist) is quite fair because not everybody travels for leisure.
“Some travel in search of a better life abroad, attend family functions or tend to emergencies,” she said, adding that blacklisting PTPTN loan defaulters from leaving the country was harsh.
On Tuesday, newly-appointed PTPTN chairman Wan Saiful Wan Jan announced that all 429,945 PTPTN loan defaulters had been removed from the travel blacklist.
He said the entire exercise to “whitelist” the borrowers was completed on June 8, a week earlier than scheduled.
Dr Nurul Shahnaz said according to the banking industry SOP, only declared bankrupts were banned from leaving the country.
“A month of arrears on a personal or commercial bank loan would trigger a red flag at a bank and this would be recorded in the Central Credit Reference Information System (CCRIS).
“It would take three months of arrears for a loan to be categorised as a non-performing loan, but the loan defaulter would still not be blacklisted from travelling,” she added.
Dr Nurul Shahnaz said “not having a pristine record on CCRIS” was punishment enough for PTPTN loan defaulters.
“A record of default on the CCRIS would serve as quite a hindrance to borrowers should they apply to get other loans from financial institutions,” she said.
However, she clarified that doing away with the blacklist did not mean that borrowers should stop repaying their loans.
“PTPTN borrowers are obliged to service their loans once they start working as it is their responsibility.
“To default on the loan is an offence,” she said, but pointed out that measures taken to ensure repayment should be reasonable.
Dr Nurul Shahnaz said incentives – such as discounts when a loan is repaid early – were a good form of encouragement to get borrowers to pay up.
Hiking interest rates on PTPTN loans would only add to the burden of borrowers, she added.
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