Malaysian Sentiment Towards Education Loan


It is known that around 50% of Malaysian students today had taken Education Loans such as PTPTN, MARA and recently, JPA too in order to finance their studies.

This scenario highlights a concerning pattern in the realm of higher education, where students not only graduate with diplomas or degrees in their respective fields but also carry varying levels of debt. The prevalence of student debts appears to have become a commonplace aspect of our college experience.

The gravity of graduates facing indebtedness intensifies when a considerable number of young professionals encounter challenges in repaying not only their educational loans but also other debts accrued since entering the workforce, as in the case of PTPTN 51% of loan holders had defaulted.

My name is Fatin Najihah and I am a final year student who is doing her Final Year Project. And, as a soon-to-owner of RM400,000 education debt, I am very interested in :
- how education loans impacted debt holders in their employment decisions
- how does the payment impact the financial decisions and mental health of all debt holders
- what are education loan holders sentiment towards repayment

I believe it is important that we evaluate the financial, economical and mental health impact of these new trend of indebtedness on our future generation. Can you spare 7-10 mins for a questionnaire? It is available in both English and Bahasa Melayu. I am not sure how to verify link here, so to answer the survey just add https:// to this tripetto.app/run/SZ1ZCI1Z84 (Currently 70 respondents away from paper requirements, would appreciate if you can share to others in your family or friends)


Some information discovered during my prior research:
- In the OECD 2020 Finacial Literacy Assessment, Malaysian scores 59.7 in Financial Literacy Score that is assessed on three aspects, financial knowledge, financial behavior and financial attitude. On this, Malaysia scored lower than the average financial literacy score (60.5). Among the 3 segments, Malaysians only scores above average in financial behavior , second only after Indonesia at 68.1 and 69.7 respectively. With the exception of Malta, among the participating countries, Malaysian also scored the lowest in financial knowledge.
- Through a survey done in 2019 by PTPTN, their repayment situation was at 51% defaulters.
- 61.2% of our youth graduates (age less than 25) falls under skill-related underemployment. As in, they are overqualified for their role. This highlights the lack of high skilled jobs to accommodate our number of graduates. (2022 DOSM data)

This begs the question, is higher education worth the cost (financial, future and health) incurred from the debt ? Hence the objective of this research.

hutang mesti dibayar habis 100%

tidak perlu bayar ptptn is one of the manifesto from ph

Done survey. Loans/debts, regardless of what kind, need not have any sentiments associated with them. You received it, you pay it back.

Anyway people should treat taking loans for higher education like a taking a business loan.
Can I pay it back? Is the rate preferable? Will it open doors for me to actually earn enough to pay it back? Are there any places offering similar programs at a more affordable fees? etc.

That's why maturity and financial literacy is important in deciding your future paths, sadly some treat it like some sort of escalator system (no thanks to our education system)
and do not give them enough thoughts. How then would people be able to consider if something is worth it or not?

America for example is going through a turning point. There's an increase of women in higher education, but there's also more 'worthless' degrees like gender studies.
This kind of degrees brings very little to your future prospects, so alot of them gets saddled with debts that is honestly unnecessary.
The men however are now more inclined to not go into higher education but going into trade schools, which generally have a lower loan average but gives a better career prospect & earning capability.

Some degrees are absolutely necessary though, specifically for professional fields & some companies (typically MNCs) have them as part of requirements for managerial positions.

Thank you for doing the survey! ^^

I agree that when taking loans, there shouldn't be any sentiment associated and everyone should have been aware of what they are getting involved. It's money, so things can easily black and white with proper communication of information. Though in my case, since JPA JKPJ was marketed as scholarship at that time and the shift to loan wasn't made aware to many (we are the second batch to receive it in loan form), most of us accept it unaware of the scale of payback since not many in our immediate surrounding have the capability to advice us regarding it (parents and family low education and lack of exposure towards contracts etc) I would say in general in my time, the offer come across a bit predatory as it targets vulnerable candidates like us for this offer as we were all ignorant SPM leavers and have mostly uneducated family backgrounds who were just sincerely happy that we got a 'scholarship' and didn't know any better. So yeah, regrets is abundant.

They are now more transparent in regards to that though. Saw them mentioning it on Myself website. So, future students that takes this loans should be able to do it much more clear headed than us.

However, putting aside my situation, I still believe that sentiment needs to be discussed in this conversation. Because, in many situations, things aren't simply black and white. For example, dissatisfaction can breeds due to lack of transparency by loan provider. Furthermore, high monthly loans payment can be holding borrowers back in many future decisions (marriage, insurance, children, car, house etc). And some may decide to stay in a job they hate, or in a job that pays well for a fresh grad but have low growth/promotion opportunities for the sake of money. Some could also just settle for whatever job they get instead of what they studied for (skill underemployment). Furthermore, due to the debt discount programs that PTPTN been doing, some people can be discouraged to pay it regularly. Opting to just wait until a bigger discount or future discount instead. The lack of enforcement of punishment can also instill a sentiment of confidence that they can escape from their obligation.

When money isn't just money or transparent or consistent, that's when sentiment breeds. When the rules keeps changing, lack of information can prevent people from planning for the future or decide to be speculative. So, to a certain extent, this survey also aims to evaluate communication and treatment between loan holder and loan provider and their enforcement of punishment. Good faith would be key I believe.

I am not saying not wanting to payback is okay. But, if most of the defaulters are telling us they are earning less than RM2000 per month despite their high education, that they aren't able to afford it, and its affecting their life and career advancement, maybe we should try to understand what aspect are affected, to what extent and how we can try to achieve a win win in this situation. Is the the loan amount? Is it a lack of job? Is it a policy issue? Is it structural ? Is it lack of enforcement ?

So, the way we are handling PTPTN is not sustainable. The amount of debt PTPTN is taking is scary, it is now even bigger than 1MDB at 67 billion. We need people to start paying back. Just being mad and complaining at those who didn't payback wont solve this white elephant. And the fact that JPA is shifting to loan policies now despite being aware of the issues faced by PTPTN, is this an appropriate move?

Most importantly, it is my greatest wish that our education system would include financial education in the syllabus. We really cannot expect the 17-18 years old to make multi thousands decision unaware of economic and market situations. Well, even my 40+ old parents don't know enough to advise their children on it hence I am in this situation. As I shared in the post, Malaysians needs much improvement in terms of financial knowledge. We know this, is the policymakers doing something about it?

You make a good point there regarding degrees worth. In fact, due to our zealousness to have more graduates, this means deteriorating academic standards in order to generate more graduates with 'good' results. This however led to the questioning on the quality of our graduates among employers, hence the question of whether a degree is worth the debt, since nowadays, a degree no longer translates into a good job.

In fact, I myself have been encouraging my siblings to consider vocational and skill related field instead due to their higher employability rather than going to university.

Who's gonna pay back the 67 billion PTPTN debt then? That's simply a rash populist policy that's impossible to be executed. Nobody wins if it happens. We need debt holders to pay back. It really says a lot about PH is this is truly what they are promoting.

50% are defaulting now so we need to understand why they aren't paying back. We are expecting degree education to boost social mobility, but the PTPTN experiment proves that this isn't true and despite the rising cost of education, the value of an education it is actually dropping. Even degree graduates are struggling with 2k salaries nowadays.

Hi Ts, one of the few students here who put up a good post and explanation to the study.

You wrote the following:

50% are defaulting now so we need to understand why they aren't paying back. We are expecting degree education to boost social mobility, but the PTPTN experiment proves that this isn't true and despite the rising cost of education, the value of an education it is actually dropping. Even degree graduates are struggling with 2k salaries nowadays.

2k isn't an excuse not to pay back. the true answer to that is the mentality of Malaysians, take and do not return. Try look at what they have, latest iphone, new handphone, instagrams of new cafes, and branded shoes. Then we talk about 2k again. As if all T1 shops have closed. So put aside 2k, and enough excuse for that. And even if it's 2k, it's not a reason not to pay back.

Yes, you take a loan, you pay back, fair and square. Don't take people's kindness (to lend you the money) turn into a right (that you think you don't need to pay back). if PTPTN isn't sustainable, better to just close it, isn't it. Let students pay for their fees. Be careful what you wish for.

I love your well thought argument, rather than complaining like usual /k, you wrote about the what, when, where, why, and how.

You’re definitely smart person, keep on working on whatever you are doing now.

I always envied my peer that got JPA, or any other scholarship , went to other country and thrive. I agreed with you having degree or master is not a must in current era, well, I didn’t even finish my degree, getting a skill that could land higher employment or career, consider myself lucky

The worst is JPA scholarship. Send overseas, but no job locally to service the bond, so end up working overseas without paying anything.

never understand what is the purpose of that scholarship that doesn't need the person to come back and serve the country.

If I tell one of the solutions is for the current generation to sacrifice some lifestyle to alleviate the problem on their offspring, I bet most would say 'why must that it's we, who must start to do so'. Parents should bear some of tertiary education costs so their children could minimize the loan size.

TS what u study until 400k debt?

I wouldn't blame the JPA scholar for not serving their bond. Once upon a time, they have a mandatory bond to work with the gov for around 7-8 years. So, the minimum they must do is to applied to gov position when they graduate. Once applied, in order for gov to exercise their right for the bond, gov MUST give them a job. If the gov didn't provide them a job, the contract was broken by the gov themselves. Hence those students are no longer be obligated by a broken contract. They are cleared of responsibility. So they are free to work anywhere.

The students aren't at fault here. It's simply a matter of the wrong policy.

So, this new loan system policy is an acknowledgement of the fact government cannot provide all jobs and perhaps a method to recoup back the previous losses. At least now, even if they dont work in government, these students are more likely to work in the country rather than overseas.

This the case right now. In JKPJ loan scholarship, we have to serve a bond AND pay back loan according to the following discount.
• Full scholarship (no loan repayment): By serving as a public servant in the civil service upon graduation.
• 25% loan repayment: By working in a Government-Linked Company (GLC) upon graduation.
• 50% loan repayment: By working in a company in the private sector in Malaysia upon graduation.
• Full loan repayment: All other situations (Working overseas, no intention of working, etc)

What's wrong here is that, gov is still dangling themselves to be the ultimate destination, yet they are still unable to provide the jobs promised.

Speaking in terms of France, this however sucks because majority of sponsored students are in the fields that government don't cover, such as chemical engineering, electrical engineering, automotives, biochemical, etc. Hence, it is for certain that most of them are unable to benefit from a 100% scholarship if they insist to stay in their specialisation. However, even if its a 25% or 50% loan repayment, its still between 100-250k in total to payback which isn't a fun amount to start your adult life with.

Normally, we expect student to graduate and work in Malaysia and start paying the monthly amount. What may happen, under this context however, is that student may choose to delay payments by continuing to master or PhD, so that they can start paying on a better salary starting line. Or work overseas, pay 100% in order to be free from the debt faster. This may be caused due to a high monthly payment amount as a fresh grad ranging between 600-700 per month. Assuming that average salary for overseas graduates is RM4000, that is still 15% of their salary. The fact that 15% of their salary is dedicated to education debt, might limit many of their actions in adult life or even their career progression, as I already mentioned before.

Based on studies, the appropriate max amount of education loan payment is 8% of fresh grad salary so that the monthly payment wont prevent loan holders from planning their future life. This however isn't practiced in Malaysia as our loan system mimic the American system more.

What would then be a solution? Debt relief is a no. And free higher education like Germany is a no too. There were conversations about implementing Income Contingent Loan Program last October, but nothing came out of that. This however is a pretty good suggestion as if the loan is considered a burden to some, we will take only how much they can afford, just like in Australia. At least, we have a continuity of repayment as long as graduates continue to strive in their career. This way, at least PTPTN can use the repayment money to help new students instead of taking up more loans themselves. (PTPTN take out high interest loans to give out low interest education loans)

Repayment threshold	Repayment % rate
Below $51,550	Nil
$51,550 - $59,518	1.0%
$59,519 - $63,089	2.0%
$63,090 - $66,875	2.5%
$66,876 - $70,888	3.0%
$70,889 - $75,140	3.5%
$75,141 - $79,649	4.0%
$79,650 - $84,429	4.5%

Nevertheless, is government and students the only party in this conversation. For me, I believe educational institution should also carry part of the burden too. It is their responsibility to generate high quality employable and skilled graduates. However, market reaction had proven that, our graduates don't have much worth. What with the lack of fresh graduates salary growth. As years go by, our youth purchasing power is simply diminishing.

Is company to be at fault. Perhaps their claim of lack of skills and experience is valid. Where and when then can these grads get the required skills? In the university. I believe, universities should be incentivized or given a deterrent according to their graduates performance. That a university should be rated according to their products(graduates). What are their starting salary, employability, average length of time taken for graduates to find jobs, etc. This move can make the universities take more accountability of their education quality and be more invested in a graduates success. What can be used as incentives or deterrent is probably the endowment fund the public universities receive.

In this way, its not just the graduates crying for higher starting salary. After all, with how much inflation over the years had been, yet the average wage stayed the low.

Year	Median Salary for graduates < 24 years old	Salary growth	Inflation rate	Inflation adjusted salary	Inflation adjusted growth
------	--------------------------------------------	----------------	----------------	---------------------------	--------------------------
2018	RM2,112	-	0.88%	-	-
2019	RM2,066	-2.18%	0.66%	RM2,130.59	-3.13%
2020	RM1,550	-24.98%	-1.14%	RM2,079.64	-34.17%
2021	RM1,590	2.58%	2.48%	RM1,532.33	3.63%
2022	RM1,624	2.14%	3.38%	RM1,629.43	-0.33%
2023	No data	-	1.50%	RM1,678.89	-
2024	No data	-	No data	No data	-

The value of 2018 salary in 2022 is RM2261.80. This means in between 2018 until 2022, salary had decreased by 28.2%. So the cries for higher starting salary was quite justified in that period of time. Their quality of life had decreased by more than 25%.

Though considering the new minimum wage in May 2023, this may affect the current graduates salary positively. To what extent cannot be determined as it differs between websites and DOSM havent reported anything since. So yeah, we need to pressure the company to raise wage. However, we also need to make education worth its value too. And considering the rates of underemployement, we need to increase the number of skilled job opportunities. We need to asses why is this happening and if its concentrated on particular field of studies? Are we producing too much graduates of a certain field? I dont think DOSM is tracking that data. Couldnt find it. Only one from 2012.


I wont comment on the lifestyle since I haven't been in Malaysia for years and am not very active on social media. I do know that there have been criticism of luxurious expenses among youths in Malaysia. To what extent I don't know. But I do know that its not a Malaysian youth thing, but a global phenomenon. For our youths, the FOMO is now on global scale it seems and we need to understand that difference. Its a generational thing.

However from my conversations with friends here, I would say, if lifestyle sacrifice needs to be made due to financial constraints, its not going to be stop going to nice restaurants, stop buying nice clothes, no vacation etc, instead we will most probably favor secondhand goods, delay marriage, not marry and choose to not have/ have less children in order to preserve quality of life. Owning a home is probably optimistic for most. Most of us are quite positive towards using credit card for their benefits and favor using public transport. And we will probably favor WFH over going to work physically if the industry and job allows.

Birth rate are already falling, so soon Malaysia gonna have to start worrying about its population number and workforce and older generation probably.

Regarding parent bearing tertiary education cost, I think that's quite hard considering that public university don't have enough spaces. And private universities are expensive. Hence the loan schemes. This however can be rectified by equipping students and parents with better awareness of job demands and financial knowledge. As long as parents stop seeing higher education as the measure of their children success, and highschool grads understand what they are getting into, we may be able to do something about the current situation.


Well, this ended up a bit long. Those who survived until here, congratulations.

This post has been edited by AtenJieha: Mar 17 2024, 06:17 PM

In France. Business Management.

Took loan of RM 50k to pursue degree in Accounting at local U Private.
IMO waste of money, end up I doing IT with no connection to the degree at all

Huhu, I am self learning data analysis too.

I want to work in a ministry one day. But, I will probably never pass the diagnostik test as my personality isn't a good fit.

So, will probably work in a GLC or MNC instead. Currently looking for data analysis or project management internships in Malaysia for summer too.

This post has been edited by AtenJieha: Mar 17 2024, 08:22 PM

filling in padu can force student to pay after study end ?

For my case:

After spm I applied so many loans but not a single one sticked ( mara, jpa, private companies),

Did my major in engineering at UM..first 2 years was with ptptn, the allowance was ok but had to be frugal and work part time during sem breaks.

I applied for jpa pidn, but got rejected twice. But did get it in my 3rd year after an appeal.

Ptptn - approx 8k - waived due to good academic results

Jpa pidn - approx 20k but hopefully can get it down to 10k (working in a private company in malaysia)


Overall, I think It turned out quite well for me. I got a job that I really enjoy. Compare to my peers, some got scholarship from private companies and have to serve their bonds ( they don't like their career path, some of them willing to negate their bond and pay the full amount, to pursue a career that they like)...I know from one view, it's not ok to cut your bond since those companies invested in those scholars to eventually work for them. On the other hand, these private scholarships ( ie from glc) are up for grabs even before those students start their degree life. 4 years is a long time to change our career interests.

In my opinion,

1.it is better to pick scholarships or loans that don't limit our choice industries unless you really know what you wanna do from the getgo. Pidn is quite good imo, I don't see a lot of bias ( ie due to race...a lot of my malay, indian and chinese colleagues are able to get that loan), and you can work in a private company and get half the discounts. ptptn as well, they don't give you much but if you can get 1st class, hey that's free money

2.Competition is stiff, after my spm years, it was hard to get a scholarship even with good results. I can only imagine the competition gets more difficult nowadays

3. Imo, it's a double edge sword to study overseas with huge loans ( unless you can reduce the amount with good grades etc). Sure you get probably better education and international exposure, but I don't think our local unis are that bad. When you apply for grad jobs there are other factors as well like communication, soft skills, attitude, extra uni activities, etc which can be gained at local uni as well...Taking my company for example ( this might be an isolated case), when I applied for it there were so many oversea grads, even with a masters degree. The majority that got it was from local unis. Same starting salary and when i talked to the hiring managers / hr.....the above skills and good grades mattered more than where they graduated. The oversea grads have to pay more for their loan compared to the local grads. I know this might not apply throughout the whole market but deemed it quite consistent along my colleagues and juniors in engineering.

A bit of deviation from the main topic but just my 2 cents hehe.

This post has been edited by aizatvader32: Mar 17 2024, 11:03 PM

Its my first time hearing about PADU. I checked it out, but still dont understand how it relates to education loan (couldnt access the website due to being in France, wont load). What do you mean by PADU being able to force student to pay back?

Oh wow, if it's as you say about the loan conversion, that sucks. I'm a JPA scholar myself, but since Malaysia couldn't provide employment for me, most of us got off scot-free. I do admit during my time as well I didn't pay much attention to it either because it was a full scholarship to attend public Uni in Malaysia, so in the off-chance I had to pay them back it's still within my means.

Though I guess I have a decent bit of awareness as I initially wanted to go to piloting school, but the program fee was quite high for my stomach back then (200k-ish). Eventhough my parents did say they're willing to partially fund it, I decided not to go through with it as I didn't want to put them on that spot. Tried to go for cadet pilot program under MAS, didn't pass on the 4th stage, so pursued other paths which is Mech. Engineering under JPA.

I believe the main problem today is the disconnect between what the industry wants vs what the education institutes can churn out. Because the grads produced are not according to market demands, it's harder to command a proportionate salary to the cost of getting the required degree. In a way Malaysia's academia kinda becomes a 'syok sendiri' place. Here's another piece of article on the market shifts in the US, where companies are now offering jobs with no degree requirements anymore:

https://www.cbsnews.com/news/college-degree-job-requirement/
https://www.businessinsider.com/google-ibm-...nk-of-america-5
https://www.cnbc.com/2022/04/25/companies-e...ed-workers.html

Speaking from somebody who completed his professional degree, education is still very much important for me and I wouldn't change that even if given the chance.
However the market dictates what the market wants, and the payoff of a (non-professional) degree is looking to be lesser and lesser over time.
So if the choice is between a niche/less worthwhile degree & burdened by huge debt vs more general vocational license & less burdening debt, I say the choice can be quite clear.

p.s. Hard work, good ethics & common sense opens you more doors than any certs ever will, and that's free.

First I heard about that. Will check it out. Would you mind sharing your two cents in my survey too please?

This is certainly correct. That's why I find MARA scholarship and PTPTN loans to be more favorable, because students have more control over their future outcome. Their choices aren't limited, and they can put efforts towards getting discounts. In my JKPJ case, discount is only given based on where you work. Your results and effort in your academic wont be rewarded.


Fair and definitely accurate point and a lot of cases. But considering my case, we are the second batch since the JKPJ shift and it wasnt marketed as loan but still as a scholarship, neither us, our families, nor even high school advisors know any better. I would like to believe that young me isnt that stupid had she known this is a convertible loan based on where one work, hahaha.

That's an interesting take on the skill underemployment in Malaysia, that we aren't producing what the market demanding and overproducing those irrelevant. This is why I am a bit frustrated on the fact I was unable to find any data on which education field exactly that is most affected by this underemployment. If we are overproducing a certain type of graduates, maybe we should disincetivize such actions and direct the resources to improving more necessities in the education.

Thanks for sharing this articles, I am checking them out. It would be great to see how this moves by the company can affect the application rates to universities, and what would be the moves by universities to survive this shift. It may range depending on education field though cause for some, universities role can be irreplaceable.

Btw, mind sharing more of your opinions in my survey please?

This post has been edited by AtenJieha: Mar 18 2024, 03:33 AM

I do agree with you.
No point to go further your studies overseas if you end up working in Malaysia.
You only go UK study if you plan to pursue career there, else it doesn't justify the huge premium.

True. No point studying overseas unless parents can cover a bit, and you can actually work there and their currency salary. Unlike JKPJ, where we are limited to working in Malaysia. Th idea of continuing working overseas isnt very welcomed

This post has been edited by AtenJieha: Mar 18 2024, 05:28 PM

we keep saying uni isn't producing what the market wants.

news keep reporting our graduates are over qualified and paid low.

problem isn't uni, problem is our industries love low skilled low paid labor. im not sure how the news can shift the blame to graduates over qualified, when the fact is our industries don't cater to science and technology. all these hard core science graduates, where do they go on working? which companies take them in?

we only prefer sales, fnb, and some admin work industries. what else?

if you study science, best work overseas, malaysia doesn't have any platform for you to establish your career.