PETALING JAYA, Dec 7 — The decision by the National Higher Education Fund Corporation (PTPTN) to garnish the wages of its borrowers has been met with both resignation and dissatisfaction from its loan takers.
Finance industry employee Jared Koh, 28, who took a ten-year loan and has been working for almost five years now, says it would be unfair for his company to deduct his salary to repay PTPTN.
“This is not what I signed up for. We agreed to the original terms and the points stated therein of how much to pay. How can you suddenly make the change like that?
“Without consulting the public or the borrowers, PTPTN is going beyond what they promised and as such makes things very one-sided,” Koh said.
PTPTN chairman Wan Saiful Wan Jan announced Wednesday that starting from January next year federal student loan takers earning above RM2,000 a month no longer have to directly pay their loans as the funds will be deducted from their salaries.
He said to do so a directive will be issued to employers to garnish wages where needed.
For banker Nurul Fauziyan Samsudin, 34, the move is “inappropriate” as it does not factor in the borrower’s other commitments. Similar to Koh, she took a 10-year loan and has been working for almost as long as that.
“Based on the table they provided, I will have to fork out RM320 monthly instead of the RM200 I have been paying all this while,” she said.
Nurul Fauziyan said this was an about-face to PTPTN’s prior promise of allowing borrowers to repay according to their affordability.
“Doing it in this manner is ridiculous. I can understand if they garnish the wages of borrowers who avoid repaying, but doing so to those who have been dutifully paying every month is highly disagreeable,” she said.
But for fresh graduates less than two years or so in the workforce or still looking for employment, Wan Saiful’s announcement is one bullet they are willing to bite down on.
Medical technician Kei Eugene, 23, who graduated last year, says the scheme poses no problem as her plans on repaying the loan remain unchanged.
“However, as I see it, there are many who (intentionally) do not pay back, and only do so for the outstanding amount when they need to go overseas since you can be blacklisted.
“I think the ones most affected will be high-income earners as it is at 15 per cent. In the end, if they do decide (on) the monthly deductions, I will not be affected so much,” she said.
Sports science graduate Samuel Joel Oh, 23, who graduated earlier this year, said despite taking a loan to fully finance his three-year programme, he was not worried about the garnishment scheme as he is in the lowest category.
“It is not a problem for me. I would like to clear the debt as soon as possible so if they want to deduct a little bit every month I am good with it,” he said.
The scheme begins at two per cent for those earning between RM2,001 and RM2,499, extending to 15 per cent for those with monthly salaries of RM8,000 or more.
Employers who assist their staff to repay their study loan through the scheme will be entitled to tax relief for the amount paid, which will benefit both full repayment or monthly repayments with the condition that employers would not impose any terms against the staff after the repayment is made.