Educational Loan Case Study

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1.1 Introduction

The discussion in this chapter will explain thoroughly about the background of the study, problem statement and focus on the objectives and followed by the research question in order to get ideas of this study.

1.2 Background of the Study

Beginning on July 1st 1997, the Malaysian government has taken steps to introduce an educational loan offered under National Higher Education Fund Corporation (PTPTN) which can lessen the financial burden. The fund was a step taken under National Higher Education Fund Corporation Act 1997 (566 Act). In addition, there are other financial institutions that also provided educational loan like Baitulmal, MARA, Yayasan Pendidikan Negeri and JPA.

National Higher Education Fund
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The enrolment of student that continues their study had increase from year to year due to the increasing amount of IPTA and IPTS. Thus, the financial institution needs to provide a large amount of fund to finance the student in the IPTA or IPTS. In Malaysia, there are 74 IPTA, 334 IPTS and 28 Polytechnics including several branches; that provide educational loan by selected financial institution. Meanwhile, students who pursue higher level of education and received educational loan will incur 4% of interest. Besides that, most public institutions of higher learning collaborate with PTPTN for the purpose of providing educational loans to the students. In addition, almost more than 2 million students of the IPTA and IPTS are being financed by the PTPTN in order to support their education expenses in the…show more content…
Furthermore, students can learn how to form a good practical so that they can survive a good financial management to repay the PTPTN education loan.

1.8 Limitation of Study


The time given to complete this research study is only 5 month. Thus, the researcher is not having enough time to providing a good research. Researchers have limited time to gather full information about the education loan repayment.


In order to prepare and provide this research, it not be denied that the cost to complete it is quite high, especially on printing, photocopy and questionnaires.


Respondent may not give a correct answer or information and some useful information cannot be obtained.

1.9 Definition of terms

(a) Education: The act and process of acquiring knowledge, systematically during childhood and adolescence.

(b) Loan: An arrangement in which a lender gives money or property to a borrower.

(c) Repayment: The repayment terms can relate to the amount of time that a debt holder has to repay a bond or debt

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