• The National Higher Education Loan Fund Corporation (PTPTN) collected 85% of the amount due to it last year, a leap from 47% the year before
• Repayment uptrend indicates that more students have completed their studies
• 144,452 incommunicado borrowers have yet to settle their debts

More students have started repaying off their loans. PTPTN has collected RM737.6 million out of the RM867.2 million due to it in 2011. This is a rise of RM99.2 million compared with the collection the year before, and is a 38% boost as the amount outstanding in 2010 is far greater at RM1.36 billion.Since the scheme kicked off on in October this year, the repayment rate has shot up to 49.9%. The scheme offered to all borrowers, including defaulters, changes their loan terms from interests of 3% to 5% a year to 1% interest a year on their outstanding amount.By early September, over 772,000 borrowers, 70.63% of those who had taken loans from the fund, have settled their accounts. PTPTN said that borrowers can pay as little as RM50 a month.The report states that this uptrend is due to the rise in students who have completed their studies. It also shows that borrowers have understood their responsibilities to PTPTN.In 2011, PTPTN sent 10,090 final warnings to defaulters, while 10,109 letters of demand were issued. However, to extend the scheme offer (Ujrah), legal action was put on hold.

Poor data system leads to unrecovered debts

About 144,452 borrowers (RM881.39 million) have yet to settle their unpaid loans, according to PTPTN report. These borrowers are eligible for the repayment scheme but are untraceable due to unreliable system. And the amount of debt owed to PTPTN is unlikely to be recovered soon.The trouble is, while losses and write-downs of creditcard debt typically fall on banks and private-sector, lenders, in the case of student debt, it is largely taxpayer money at risk.PTPTN's old data system - Elmas - is being modified to improve the system. A new system based on Elmas is also being built which totals for RM26 million. This according to some observers, is unjustifiable. Some say that PTPN should instead buy an existing system used by banks for under RM10 million and tweak it to fit its requirements.And while PTPTN is fixing and building its new system, other efforts have been taken to improve their collection rate.These efforts include: Holding briefings at campuses together with the Credit Counselling and Debt Management Agency and student representative councils; Participating in the ‘Jom Heboh' carnival; and Indoor and outdoor advertising, including on in-train side panels, newspapers and billboards.