Cabinet rejects proposal to blacklist student loan defaulters

It's a "no go" for the proposal to link the National Higher Education Fund (PTPTN) loans to Bank Negara’s credit bureau database.

Youth and Sports Minister Khairy Jamaluddin in a tweet said the Cabinet had rejected the proposal during its meeting this morning.

“Just completed Cabinet meeting. PTPTN would not go ahead with the proposal to list its student loan defaulters under CCRIS.

"Thank you prime minister and education minister for listening to the youth,” he said on Twitter

The proposal by PTPTN to link its defaulters to the Central Credit Reference Information System (CCRIS), which was announced by Education Minister II Datuk Seri Idris Jusoh two days ago, was met by an uproar by lawmakers, non-governmental organisations, student activists and even from Khairy himself.

Khairy had said youths are required to take student loans because the government does not provide free education at higher learning institutions.

He said such loans were also different from other credit card or higher purchase loans, where those were by choice, but this was a necessary loan for them to obtain qualifications for their career development.

PKR strategy director Rafizi Ramli had also hit out at the move, saying that such action was a form of threat and punishment to the students as they would have problems getting hire purchase loans later on while Perkasa’s secretary-general Syed Hassan Syed Ali said it was a persecution of Bumiputera youths as most of these loan holders are Bumiputeras.

Student activist Adam Adli Abdul Halim told The Malaysian Insider yesterday that university students were contemplating holding a protest if the proposal went through.

PTPTN has approved education loans to 2.2 million students since July 1, 1997, which amounted to RM49.9 billion.