Education funding is a lifeline for most students who want to continue their studies in higher education. The availability of student loans, such as the National Higher Education Fund Corporation (PTPTN), is a necessity to ensure a steady supply of skilled workers for the country’s economic progress, nation building and better distribution of wealth.

This year, PTPTN celebrates its 25th anniversary, making an important contribution to Malaysian society. It has played an important role in democratising education, which in turn has contributed to the development of the country’s human capital.

Since its inception in 1997, PTPTN has aimed to ensure that no student is excluded from higher education because of financial constraints. The organisation was founded in line with the policy of education democratisation, which gives all parties equal opportunity to obtain loans or funding for higher education.

It started operations on Nov 1, 1997, in Bangunan Wisma Chase Perdana, Off Jalan Semantan, before moving to its new headquarters at Menara PTPTN on Jalan Yap Kwan Seng in Kuala Lumpur in 2015. It has 64 branches across the country.

In the initial stage, PTPTN introduced Wang Pendahuluan Pinjaman (WPP) for students who wanted to pursue higher education without the need for their parents to sell their assets or property or even take out a bank loan. So far, a total of RM1.41 billion in WPP have been disbursed to more than 950,000 students nationwide.

Its CEO Ahmad Dasuki Abdul Majid says: “PTPTN has contributed a lot to the community. Our children can easily continue to learn at the highest level with PTPTN’s financial support. Our children succeeded and were able to improve their standard of living. If there were no financial institutions like PTPTN back then, they might still be at the same socioeconomic level. With PTPTN, we have been able to give them access to higher education and bring great benefits to the community.”

As at Sept 30, PTPTN has helped a total of 3.7 million borrowers with a total loan amount of RM67.69 billion. Besides administering education loans and collecting loan repayments, PTPTN also offers a savings instrument, the National Education Savings Scheme (Simpan SSPN), which helps parents make financial plans for their children’s higher education.

“PTPTN does not want to be seen as a lender and mere debt collector but, rather, to be seen as an ‘education fund’ for Malaysians. PTPTN is a higher education fund that not only lends and collects, but also provides opportunities for success. It is one of the indicators of salvation and a great financial contribution for the children of the nation,” Ahmad Dasuki says.

With 25 years behind it, PTPTN remains rooted in the heart of a community to serve society and country, says its chairman, Dr Apli Yusoff. “Since the founding of PTPTN, I have witnessed several changes. I am excited and proud to be part of PTPTN. I also see it as the leading education fund in the country. PTPTN has contributed a lot to the country’s human capital by providing education loans and spreading a culture of financial literacy among parents through Simpan SSPN,” he says.

While some prefer to save with traditional financial institutions, many are still unaware of the benefits of saving with Simpan SSPN. Since 2004, PTPTN has taken the initiative to shift the mindset from borrowing to saving with the launch of Simpan SSPN. It has helped Malaysians to make financial plans for education at an early age, and cultivate the savings culture among parents for their children’s education.

The total amount of deposits for Simpan SSPN stood at RM12.96 billion as at September 2022, with 5.6 million accounts. As it is government-guaranteed and shariah-compliant, depositors who use Simpan SSPN are offered numerous privileges and benefits, including tax relief on savings of up to RM8,000 per year, matching grants up to RM10,000 for one eligible family, free takaful coverage on depositors and competitive dividends.

“PTPTN strongly encourages parents to take advantage of this opportunity to save so that children can enjoy more benefits. PTPTN’s efforts never stop at one point, but has as its primary mission to encourage saving to ensure that children are not saddled with debt after graduation while reducing society’s reliance on credit,” Ahmad Dasuki says.

PTPTN offers products such as Simpan SSPN Prime (formerly known as SSPN-i), which maintains existing privileges such as competitive dividends and free takaful coverage. In addition, Simpan SSPN Plus (formerly known as SSPN-i Plus) has been enhanced with even more attractive benefits.

Various campaigns and promotions continue to be intensified to promote savings, including the “Cabutan WOW” campaign and “25 Years of PTPTN”, a symbolic campaign for PTPTN in promoting savings in conjunction with its 25th anniversary. This campaign, which runs from Jan 1 to Dec 31 this year, offers 350 winners attractive prizes worth a total of nearly RM1 million.

The PTPTN has also established strategic links with various government and private entities. For example, Ahmad Dasuki says, PTPTN has collaborated with the Sports, Curriculum and Arts Division, under the Ministry of Education, by launching the Kelab Simpanan Pendidikan to promote awareness among primary school children about the importance of saving for the future.

PTPTN has expanded the channels for loan repayment, which initially could be carried out only over the counter. It now offers a variety of repayment methods through various platforms, including internet banking, payroll deduction, direct debit and payment through the Employees Provident Fund.

It has introduced a variety of customer-friendly approaches to make it easier to facilitate the transactions of its customers, including running a campaign that offers PTPTN customers special benefits.

PTPTN hosts the Financial Literacy and Career Preparation Programme (FLICK), aim primarily for prospective graduates who want to learn about financial management and to help students prepare for entry-level jobs and market opportunities after graduation.

To ensure that PTPTN stays on a par with other financial institutions in terms of offering the latest digital facility, it has developed a mobile application called myPTPTN to enhance online services and provide online channels to promote cashless payments. This is in line with the government’s digitalisation agenda and efforts in digitalising higher education.

PTPTN launched the myPTPTN mobile application on March 29 to offer customers services such as statement review, loan repayment, account opening and payroll deduction. Previously, customers had to log in to different portals to use PTPTN’s services. Now, they can use various PTPTN functions related to refunds, savings and credit in a single application through Single Sign On (SSO).

The myPTPTN mobile application can be downloaded on mobile phones through digital distribution platforms such as the App Store for iOS users, Play Store for Android users and Huawei AppGallery for Huawei users. This application aims to simplify customer affairs and ensure customers get PTPTN services anytime and anywhere without borders more easily, quickly and securely.

To help borrowers, PTPTN has also improved its early warning system by notifying borrowers of their debt arrears.

“PTPTN is also very open and concerned about the difficulties faced by PTPTN borrowers who are less able to repay their loans. Therefore, borrowers can negotiate to restructure their loan so that monthly payments can be reduced according to their ability.

“In keeping with the #PTPTNSediaBantu initiative, PTPTN is constantly committed and ready to assist borrowers who have queries related to the loan repayment,” says Ahmad Dasuki.

In line with its Strategic Plan 2021-2025, PTPTN wants to achieve its mission and vision as an organisation that can manage funds strategically based on excellent governance and integrity.

“I thank all PTPTN customers, especially PTPTN borrowers, who always support PTPTN to ensure the sustainability of the loans for future generations. PTPTN also encourages all Malaysians to have a Simpan SSPN account, as this deposit offers privileges and benefits. Parents who are still looking for the best savings package should open an account with Simpan SSPN. Opening an account is easy, fast and secure through the myPTPTN app,” says Ahmad Dasuki.

“Parents need a more targeted savings approach for their children’s personal career development,” says Harveston Financial Group co-founder and executive director Phang Kar Yew. “The savings mindset of ‘your children’s future success depends on their parents’ present efforts — short-term pain for long-term gain’ is still highly relevant to carrying out essential child-rearing for long-term accumulation purposes.”

This clearly shows the importance of PTPTN. Given the financial challenges that families face post-Covid-19, the role of PTPTN is even more important now, especially for families that need funds for their children’s university education.

Phang says: “The pandemic of the past two years has indeed had a strong financial impact on families in the B40 and M40 income groups, particularly in planning for their children’s university education. Parents have lost their jobs, there have been pay cuts and more. Their long-term savings for their children’s education may have been severely depleted, besides their having a hefty burden of debt.

“Moreover, the social and economic outlook of the country as a whole and job insecurity during this endemic period may lead the younger generation to opt for earlier permanent employment after they complete the Sijil Pelajaran Malaysia, to earn their own keep and support their families. They conclude that higher education may not be the right path for their life success and well-being. Therefore, the social and economic well-being of the country’s entire family may be seriously mismatched in educating children for the new endemic market environment.”

Lee Ewe Chuan, a lawyer at Lee Law Office, applied for a PTPTN loan after graduating from high school; he attended law school from 2010 to 2013. Lee says: “With the help of PTPTN, I could take the course of my choice and that has brought me to where I am today. Without PTPTN, I probably would have had to choose a different course and gone on a different route because of limited finances at the time. The PTPTN loan has opened up opportunities for students like me to further our studies in the course of our choice. This might seem insignificant, but I feel more motivated doing something I prefer instead of the other way around.

“I have been seeing news reports on PTPTN borrowers not making repayments. Every time I see such news, it reminds me that I’m privileged to have secured a PTPTN loan ... I [will] fulfil my responsibility as a PTPTN borrower by paying the monthly instalments and paying off the PTPTN loan as soon as possible in the hope that other students in need of the PTPTN loan will not be denied their equal opportunities due to my non-repayment.”

For borrowers who graduate with outstanding results, PTPTN offers a loan repayment waiver to those who earn a first-class bachelor’s degree, indirectly reducing borrowers’ debt. As at end-September, a total of 85,679 borrowers have taken advantage of this RM2.2 billion incentive.

Sukanthi Supamanam, a doctor at a government clinic in Tanjung Malim, Perak, says Simpan SSPN is the best savings plan, as it has been a great help in planning the financing of her education.

“Initially, my parents saved money with Simpan SSPN for my siblings and me for our education, besides applying for PTPTN loans. In my case, PTPTN took my savings to pay for the first semester of my degree programme, since I was studying abroad at the time. Savings were very helpful for me since my father was the only breadwinner and my mother is a housewife,” she says.

On the occasion of PTPTN’s 25th anniversary, Sukanthi received the Augerah Keluarga Malaysia for being the best “Simpan SSPN” depositor. She says: “This title is a great honour for me. We are very grateful for this once-in-a-lifetime opportunity and would like to thank PTPTN for providing this platform for savings and early education planning for the young generation.”

Sukanthi has also deposited money with Simpan SSPN for her two sons, aged six months and two years, for their education.

“Since Simpan SSPN is a trustworthy platform, my husband and I have great confidence in saving with Simpan SSPN for our children, since it is guaranteed by the government and only a small amount of money is required to start this savings plan. Besides, Simpan SSPN also offers a good dividend, which is covered by Takaful, and savings with it is tax-deductible,” adds Sukanthi.