PTPTN Education Loan - Guide to the Application, Disbursement and Repayment Process

They say that education is the ultimate key to success. But in this era, getting a tertiary education could be very, very, costly. So what are we to do? The best way to get free all access education is of course, by applying for scholarships / sponsorships. If you have the scores to show for it, then try your best to get that scholarship! Another way to afford tertiary education is of course, by applying for a loan. While personal loans are plentiful at banking institutions, the Perbadanan Tabung Pendidikan Tinggi Nasional (PTPTN) is an institution that issues loans specifically to support your education needs.

So if you are eager to apply for a PTPTN Education Loan Scheme or just curious about how it works and what it offers, then stay on this page because we will give you all the info you need to know!


The word PTPTN has been uttered so many times but you don't quite know what is it all about? Fret not, just keep on reading and you'll be a PTPTN expert in no time.

What is the PTPTN?

Perbadanan Tabung Pendidikan Tinggi Nasional (PTPTN) is a government-owned corporation established under the National Higher Education Fund Corporation Act 1997. With its main office located at Wisma Chase Perdana in Damansara Heights, PTPTN started its operation in 1997 and has three main functions:

  • To manage the financing for higher education and its repayment collection;
  • To provide a savings scheme and administer the deposits for the the purpose of higher education; and
  • To perform any other functions entrusted to PTPTN by any written legislation.

To this end, the PTPTN Education Loan Scheme (ELS) was set up for one purpose: To provide opportunities to students to continue their tertiary education.

PTPTN Education Loan Scheme (ELS)

The PTPTN Education Loan Scheme aims to provide education loans to students pursuing their studies in local institutions of higher learning (Institut Pengajian Tinggi or from now, IPT). Depending on their prospective parents' income, the ELS will enable students to either fully or partially pay the tuition fees and other expenses for the duration of their study in the institutions of higher learning.

Thinking of Applying?

Those who are interested will wonder: Who is eligible to apply and what are the terms and conditions?


The PTPTN ELS is open to ALL prospective Malaysian students (under the age of 45) who have had an offer to undertake studies or are currently studying full-time and part-time at the Diploma, First Bachelor Degree, Master, Doctorate and Professional Course levels in IPTs established under the following acts:

  • Universities and Universities Colleges Act 1971
  • Institut Teknologi MARA Act 1976
  • Private Higher Education Institutions Act 1996
  • Education Act 1996

But there's an exception though! For part-timers, only those studying in local IPTAs (Institut Pengajian Tinggi Awam or Public Univeristies) are eligible to receive a loan. We have summarized the level of education in IPTA and IPTS (Institut Pengajian Tinggi Swasta or Private Universities) and its eligibility for a PTPTN loan.

Education Level
PTPTN Eligibility
IPTA (Public Universities) : Full Time
IPTA (Public Universities) : Part Time
IPTS (Private Universities) : Full TimeIPTS (Private Universities) : Part Time (Only available for UNITEM, Wawasan Open University, UNITAR, Asia E University)
Advanced Diploma
Professional Course
Master's Degree

For the full list of courses and their maximum disbursements, just click here.

Terms & Conditions 

School leavers and students, in order to apply for a PTPTN Education loan scheme, you must note the following:

  1. Passed Malaysia Certificate of Education (SPM) with credits in any 3 subjects
  2. For Community College Certificate and Polytechnic Diploma graduates with CGPA 3.0 and above, a pass in SPM.
  3. IPTA/IPTS/Polytechnic students must register to pursue courses approved by the IPT Management Department IPTA/IPTS/Polytechnic Management Department and Community College of the Ministry of Higher Education.
  4. IPTS students must obtained the Accreditation Certificate from the Malaysian Qualifications Agency (MQA). The course and Accreditation Certificate approval period must still be valid on the date of application.
  5. All students must possess entry requirements determined by the Ministry of Higher Education to pursue the course. For students with qualifications that differ from that stipulated, verification that the said qualification is equivalent to the required qualification must be obtained from departments or agencies specified as above.
  6. The remaining period of study upon application must exceed one year.

Application Dates

Applications must be made online through the Online Loan Application Website. There is then a lengthy process of filling in an application form and preparing supporting documents.

The deadlines for applications depend on the individual IPTs, to see yours specifically, click here.

Skim Simpanan Pendidkan Nasional (SSPN)

If you're thinking of applying the PTPTN ELS, then make sure that you have an SSPN account because starting 1 January 2012, prospective students who wish to apply for PTPTN education financing MUST have an SSPN account with a minimum deposit of RM20.

What is the SSPN and what benefits will you get?

Skim Simpanan Pendidikan Nasional (SSPN) is a savings scheme designed by PTPTN to help students in tertiary education to start saving early. The advantages for opening an SSPN account are:

  • Tax relief for current year's net savings of up to RM3,000 per annum (check out our tax article here!)
  • Free insurance coverage for depositors with savings of RM1,000 and above
  • Matching grants of up to RM10,000 for eligible families (For families with a combined monthly basic salary not exceeding RM2,000 per month and a child registered in a higher education institute)
  • Savings guaranteed by the government.

How do I Open a SSPN Account?

An SSPN account can be opened at the PTPTN service counter at One-Stop Centre, KL Sentral, Maybank, Bank Islam and all branches of PTPTN agents throughout the country. Documents required for this purpose are:

i. Copy of MyKad / military card / police card of the applicant;
ii. Copy of child's birth certificate / MyKid / MyKad; and
iii. Testimonial / Certificate of Adoption (for parents intending to open an account for the adopted child under their legal custody)

The minimum deposit amount for the purpose of opening an account is RM 20.00. Additional savings can be made ​​as soon as the SSPN card is received or any other form of verification of membership in the National Education Savings Scheme.

Disbursement of PTPTN Loan

Just like any other type of loan, you have to know the ins and outs of the loan before committing your name on the dotted line! Thus, we have provided you with the basic information of all you need to know such as the loan amount, disbursement period and payback period. For those who already have a PTPTN loan, keep on reading to know how to get a lower rate for your future repayment.

Loan Amount - How much will I get?

It all depends on your institute of education, education level and and your courses. Basically, there are three types of loan schemes:

  • Full Amount :  Parents’ income less than RM4,000 per month
  • Partial Amount : Parents’ income between RM4,000 to RM5,000 per month
  • Tuition Fees Only : Parents’ income more than RM5,000 per month

To find out the loan structure for your current college / university or education level, click here.

If the maximum loan amount is still insufficient to cover the cost of tuition fees, then prospective students will have to ensure they are able to get alternative funding to cover the shortfall.

Disbursement Period

PTPTN itself is a corporate body which communicates with the IPTs, therefore students who have the PTPTN loan approved need not worry about the timing of the loan disbursements for the tuition fees as this will be taken into account by PTPTN. If all necessary the offer documents and agreements have been completed, the first disbursement will be made within 21 working days of the date of receipt of the documents. The approved disbursement will be credited directly into the student's bank account.

For students getting Tuition Fee Loan Amounts only, PTPTN will disburse the funds directly to the IPT. For those with the Full Amount, the residual amount of money that will be debited into each students' account each semester follows this formula:

Residual Amount into Student's Bank Account = Full Amount - Tuition Fees - Insurance Deductions - Loan Advance Deductions (where applicable)

Insurance Deductions 

The PTPTN ELS includes loan insurance to cover the loan issued by the PTPTN in the event of the borrower's death. Under the concept of group coverage, the amount of the loan issued by PTPTN to all borrowers will be fully protected from takaful operators appointed by PTPTN for every five (5) years. Therefore, if you choose to take a loan with PTPTN, the insurance deduction will be as such:

  • RM0.74 per year on each RM1,000 disbursed (for loans received in 2012 and later)
  • RM0.40 per year on each RM1,000 disbursed (for loans received between 1997-2011)

Loan Advance Deduction (WPP deduction)

The Loan advance (WPP) was implemented in 1999 to assist needy students who have received IPTA offers for the first time. The WPP is part of the total loan and is given earlier to enable students to make preparations before registering at the IPT.  It is disbursed to these students one week before the date of registration at the IPTA. The grant of WPP is subject to the following conditions:

  • Malaysian citizens
  • The total family income is less than RM4,000
  • Never previously received WPP or PTPTN loan

General Disbursement Rule

Show me the money! So when your application have been approved, when will it be in the bank account ?

  • First semester - Loan debited within 2 weeks of registration and confirmation from the IPT
  • 2nd semester onwards - Loan debited after confirmation from IPT that student is still enrolled in the course and has obtained GPA of 2.0 in the past semester

Repayment of PTPTN Loan

Payback Period - When should you start paying back the loan?

PTPTN requires you to start paying your loan 6 months after your graduation date, so make sure that you start paying off the installments for the PTPTN loan from that point in time to avoid going on the blacklist (after 3 reminders of course).

Starting from 1 January 2004, the repayment period will be set in accordance to your loan amount. So if you plan to take up PTPTN ELS, this is how your repayment period will look like:

Education Loan / Financing Amount
Repayment Period
RM10,000 and Below60 Months (5 years)
RM10,001 to RM22,000120 Months (10 years)
RM22,001 to RM50,000180 Months (15 years)
Above RM50,001240 Months (20 years)

Budget 2013 Update : You can now get a special discount when you make a full repayment on your PTPTN loan, full details here.

Exemption From Loan Repayment

PTPTN celebrates those who pass their degree with flying colours by giving them an exemption from loan repayment.  Qualified candidates are those who complete their bachelor’s degree studies with first class honours, and make an application for exemption. However, borrowers from private institutions of higher learning are limited to those who pursue courses accredited by the National Accreditation Board (LAN).

Failed / Discontinued / Changed Course or Cancelled Loan

What are the penalties for failed, discontinued, changed course or cancelled loan? Basically, borrowers who have failed, discontinued, changed course or obtained other sponsors have to pay the lump-sum amount of their loan (instalment method not allowed).

For more information on this subject, just click here.

Administrative Costs

Between January 2004 and June 2008, PTPTN implemented a fixed administrative cost rate (the loan interest rate) of 3.00% p.a. on reducing balance for diploma and degree level courses, and 5.00% p.a. on reducing balance for masters, PhD and professional courses (implemented in March 2007). This administrative cost rate is in effect following the 6 month grace period immediately after graduation. If you choose to settle the loan in full prior to this 6 month grace period expiring then you will not be charged any administrative cost.

From 1 June 2008 onwards, all new PTPTN loan applicants will be migrated to the 1% p.a. 'Ujrah' fee and existing PTPTN loanholders will have the option to switch from the existing 3% p.a. on reducing balance to a 1% p.a fixed flat rate.

1% "Ujrah" Interest Flat Rate vs 3% Adminstrative Cost on Reducing Balance 

PTPTN have introduced Ujrah, a loan conversion scheme supposedly to encourage ex-students to clear off their PTPTN debts faster and with less interest. Basically, by applying to the Ujrah loan conversion scheme, you can replace the existing fixed administrative cost rate of 3% or 5% per annum on reducing balance to to 1% flat rate per annum. The lower number sounds good, but should you take it?

(1) Flat Fixed Rate vs Fixed Rate on Reducing Balance

Watch out, make sure you know the difference between fixed rate per annum on reducing balance and fixed flat rate per annum. Fixed rate per annum on reducing balance is a rate similar to that of your mortgage product, where interest is charged on the current balance which reduces over time as you pay down the loan. Fixed flat rate per annum is similar to that of a typical Malaysian personal loan product, where the rate is charged over the whole balance over the tenure.

As a rule of thumb, for loans above 12-month in tenure, you have to multiply a fixed flat rate by about 1.8-1.9x to equate it to a fixed rate on reducing balance. For example, you will be charged more interest with a 5% p.a flat rate than a 7% p.a. fixed rate on reducing balance, because the fixed flat rate compares similarly to a 9% p.a. rate on reducing balance. Try our calculator below: (To avoid confusion, Fixed Rate here = Fixed Flat Rate and Effective interest rate here = Fixed Rate on Reducing Balance)

So for most people, the effective rate with the 1% p.a. fixed flat rate will be between 1.88%-1.99% p.a. on reducing balance depending on tenure (this compares favourably to the 3% p.a. fixed rate on reducing balance). BUT....

(2) Amount of Loan Balance Reference Date

Here's another catch for people thinking about converting to Ujrah: The 1% flat rate interest will be calculated from your debt balance from 1 June 2008 (yes, we agree that its a rather arbitrary date/policy).

So for example, if your debt balance in 2012 is RM 10,000 and you're debt balance in 2008 is RM 30,000, the 1% interest will be calculated from RM 30,000! As another rule of thumb, consider changing to Ujrah if your current outstanding balance is more than 63-65% the value of your outstanding balance as at June 2008. (This figure is done using a working backwards calculation of 1.88-1.94%/3%)

Ujrah conversion is eligible to all existing borrowers who have a PTPTN outstanding loan balance at 1 June 2008 with the exception of the following cases:

  1. Borrowers subjected to law enforcement action.
  2. Borrowers who have breached previous loan agreements - (cancelled loans, failed in studies, quit studies and obtained another sponsor)

To know more on how to apply just click here.

I Have Enough Savings To Fund My Education - Should I Still Apply For the PTPTN ELS Loan?

The choice is entirely up to you, but we say, yes! Let's assume that you have RM 30,000 worth of savings. Should you use to it to pay off your degree, or should you apply for PTPTN ELS and store your RM 30,000 into a fixed deposit account (as an example only, if you have any investment suggestions, just shout it out in our forum!).

(To know more about fixed deposits and how it can help you grow your money, just go to our fixed deposit article!)

So let's do a quick calculation (the calculation below is strictly for example only):

Assume the degree and living expenses costs RM30,000 over 3 years. If I have RM30,000 on June 2012, I can either choose to:

A : Use the RM30,000 saving for education expenses, RM10,000 for each year, with any remaining balances put into a 12-month FD (at 4% p.a.)

B: Apply for a PTPTN ELS Loan amount of RM30,000 which will disburse RM10,000 each year, and put the RM30,000 saving in a 3-year fixed deposit at 4% p.a, and in June 2015 repay the PTPTN Loan of RM30,000 (no adminstrative cost if repaid in full within 6 month grace period).

A's Money (RM)B's Money (RM)
Year 0 (2012)RM20,000.00RM30,000.00
Year 1RM10,800.00RM31,200.00
Year 2RM1,232.00RM32,448.00
Year 3 (2015)RM1,281.28RM3,745.92
Additional Saving-RM2,464.64

As you can see, with the course and expenses totalling RM30,000 you can earn almost RM2,500 more over the 3 year period by opting for a PTPTN loan over self funding.

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