PTPTN Travel Ban Comeback (2025): Everything You Need to Know

Estimated reading time: 12 minutes

There’s a hot topic going around lately – billions of ringgit in PTPTN student loans remain unpaid, and only 1 in 3 defaulters are making repayments. Due to this, the government is now considering stricter measures to address the issue. Here’s why people care. If you’re planning to travel overseas and still have outstanding student loan debt, you might be banned from leaving the country.

In this blog, we will dive into the current problem of PTPTN loan repayment and what the government has done to prevent the issue from becoming more serious. Also, we’ll look back at the travel ban measures by the government and the potential effects on Malaysians. We’ll also explore the reasons behind the low repayment rates and what solutions can be implemented in the future.

Issues with PTPTN Repayment

As of January this year, the National Higher Education Fund Corporation (PTPTN) has sent out 2.1 million reminder notices to borrowers who failed to repay their education loans. This represents more than half of the total loans issued, amounting to around RM3.95 billion as of the end of 2023, from a cumulative loan amount of approximately RM71.31 billion, which is quite a large figure! This shows that our country has provided strong support for those who wish to pursue tertiary education.

However, there’s now a serious concern. In 2023 alone, overdue payments reached an all-time high of RM10.85 billion, involving 1.2 million borrowers. The amount that was repaid during the year was only RM3.55 billion which is roughly 32%. That means for every three borrowers, only one is repaying their loan.

Now, you might be wondering: Why are people taking this for granted, and are they facing any consequences?

The Flaws of the PTPTN System

Here’s what you need to know. If you haven’t settled your PTPTN repayment for more than 3 months, they’ll send you a warning letter. However, unlike housing or car loans, there isn’t a very strict monthly repayment schedule.

You’ve probably heard relatives say that the government will ban you from traveling if you don’t pay back your loan. But actually, the travel ban only kicks in when you’ve failed to make repayments for 36 months, that’s three full years!

That’s why many people take advantage of this loophole, and over time, more borrowers follow this “trend.”

Because of this situation, Prime Minister Anwar is now considering introducing stricter measures to prevent things from getting worse. Which brings us to the next point – the possible return of the travel ban enforcement.

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Travel Ban for PTPTN Loan Defaulter

Ten years ago, the government began enforcing a travel ban on PTPTN loan defaulters, starting with around 84,000 individuals in 2015. However, things changed just three years later. When the new Pakatan Harapan government was elected during the 14th General Election in 2018, good news came for defaulters where around 429,000 borrowers were released from the travel ban.

In my view, bringing back the travel ban isn’t just about stopping people from going on holidays. Some borrowers might miss out on overseas job opportunities with better pay. And if the government decides to implement a stricter repayment system, it could discourage future students from borrowing from PTPTN altogether. That in turn, could limit access to tertiary education, especially for families who can’t afford university fees out of pocket.

Based on the latest data, only 34% of the total 16.37 million workers in Malaysia have pursued tertiary education, including diploma, bachelor’s, and master’s degrees. In comparison, our neighbour Singapore has a much higher rate – 63.8%, which is almost double ours. So if the government makes the system too strict, it could result in fewer people being able to afford university education, ultimately impacting the nation’s economy in the long run.

With all these factors, I think it would be more reasonable if the travel ban only applies to defaulters earning RM4,000 and above, which was also a suggestion that was actually part of Pakatan Harapan’s “10 Promises in 100 Days” manifesto. Personally, I think that’s a fair starting point.

Another possible approach is to restrict loan defaulters from renewing their passports, rather than banning them outright at the airport. This method could be more effective and less disruptive, especially for those who only find out about the ban when they’re already at the airport.

However, these are just my personal thoughts. As of March 2025, there is still no official announcement regarding the reinstatement of the PTPTN travel ban.

Blacklist Defaulters on CCRIS

Besides the travel ban, the government has also introduced other measures to improve the situation. One of them is listing PTPTN borrowers in the CCRIS system, which began in June 2015. Along with automatic salary deductions for civil servants, these measures helped increase the loan repayment rate to about 79%, until the General Election in 2018.

In case you didn’t know, CCRIS (Central Credit Reference Information System) is a credit reporting system managed by the Credit Bureau of Bank Negara Malaysia (BNM). It provides reports on your financing and repayment history to assess your creditworthiness, basically, how trustworthy you are when it comes to borrowing money.

So if you default on your PTPTN loan, it could affect your chances of getting approved for future loans like credit cards, car financing, or a home loan. According to PTPTN’s official website, this CCRIS listing is still actively enforced.

Policy Uncertainty – PTPTN Discount Campaigns and Waiver

Now, you might think that CCRIS would be enough to manage the low repayment issue, but in fact, there’s another major factor at play – policy uncertainty.

Over the years, many politicians have made attractive promises in their election manifestos, including potential PTPTN loan waivers, just to win votes. This has led the Education Minister to urge politicians to stop making such promises. This is because when borrowers believe that their loans might be waived in the future, they lose the motivation to repay now.

On top of that, PTPTN occasionally runs discount campaigns on repayments, but these campaigns aren’t consistent. So it becomes even harder to convince borrowers to pay on time when they think they can just pay less later.

However, these campaigns might not return, at least not anytime soon. Because the government has already stated that they do not plan to reinstate repayment discounts, as it’s costly to do that.

But you don’t have to worry as missing your scheduled payments doesn’t automatically mean you’re disqualified from future financial help. In fact, PTPTN encourages borrowers who are struggling to reach out and discuss a restructured repayment plan that suits their situation. I think it’s still a fairly considerate approach.

Is High Cost of Living Really the Issue?

At this point, many people would argue that the reason they struggle to repay their PTPTN loans is due to the high cost of living. But let’s look at the numbers. The median wage in Malaysia is around RM2,745, while those with tertiary education typically earn around RM4,000 or more.

Moreover, PTPTN loans come with a low 1% interest rate, which is lower than other types of loans that usually charge a minimum of 4% interest over 5 to 20 years.

So when you put things into perspective, it’s clear that the issue may not be entirely about the high cost of living. The repayment terms are actually quite manageable compared to other financial commitments.

Alternative Choices that the Government Can Take

Guarantor

Personally, I think the government can still take further action to address the PTPTN repayment issue beyond what has already been done. For example, they could require a guarantor for each PTPTN loan, this could be a parent, sibling, or relative. If the borrower defaults, the guarantor would then be responsible for repaying the loan.

The benefit of this measure is twofold where it not only helps protect PTPTN from accumulating more unpaid debt, but also encourages borrowers to think more carefully before applying and making them more accountable and responsible for their financial commitments.

Automatic Salary Deduction

Besides that, the government can also implement automatic salary deductions for government servants that were mentioned earlier. Just to let you know, this is done through income-contingent loans (ICL) which is a system where a fixed repayment amount is automatically deducted from your salary, similar to how EPF contributions work.

This idea was actually supported by Prime Minister Anwar back in late 2023. He stated that the ICL system is a pragmatic approach that doesn’t overly burden borrowers, which is a more sustainable solution for long-term loan repayment.

Conclusion

Until now, it’s clear that the PTPTN loan repayment issue still matters today. While the government has already taken several steps to address the problem, more can be done, especially when it comes to raising awareness. Because let’s be honest, people often only care when they truly understand how something affects them. Change may take time, but I believe with the right approach, things can improve gradually.

At the end of the day, PTPTN isn’t just about recovering money from defaulters. More importantly, it’s about ensuring the long-term social benefit for future generations. Imagine your own children or grandchildren whether they get access to affordable higher education depends on how well we manage this system today. That’s why, as citizens, it’s our responsibility to repay what we’ve borrowed. Not just for the sake of the government, but to help build a stronger, more educated workforce that can contribute to the country’s growth.

Checkout the YouTube video for a visual guide to this blog!

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