LETTER | The National Higher Education Fund Corporation (PTPTN) was established in 1997. Since then, it had given out study loans to over 1,900,743 applicants.

But 410,500 PTPTN borrowers have yet to repay a single sen of their loans, averaging RM7,000 each. They seem to be treating their loans as scholarships, with no obligation to pay back.

Disturbingly, the majority of these defaulters completed their studies in the last four years, and the number is likely to swell.

These unserviced loans amounted to RM2.79 billion, while loans that were not repaid according to schedule amounted to another RM4.05 billion.

This is despite the discounts given over the years to encourage borrowers to pay up. Just last month, Prime Minister Najib Abdul Razak announced in the 2018 Budget that those who settled their loans by December next year would be given a 20 percent discount.

A 10 percent discount would also be given to those who pay their loans according to schedule via salary cuts or direct debit, or those who settled half of what they owed.

Borrowers who are behind in repayments or have not paid a single sen owe PTPTN a total of RM6.84 billion, which is enough to provide loans for almost a million new applicants.

If no new funds are injected into PTPTN, it could mean a large number of students would be denied study loans in future, no thanks to the defaulters.

Employers should also keep a close eye on PTPTN defaulters. If they lack the principle to repay loans, it is perhaps more likely that they may also have a tendency towards other bad habits such as theft and corruption.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.