Yes, with a condition. PTPTN's education loan has run on an Ujrah (service fee) contract since the National Fatwa Committee for Islamic Affairs ruled on it on 28 July 2008, and PTPTN describes the Ujrah loan as Shariah-compliant. The fee is 1% a year, fixed at the start of repayment as a lump sum (balance times 1% times years), and it does not compound. The condition: if you took your loan before December 2008 and never signed the Ujrah conversion offer, you are still on the old conventional scheme with an administrative charge that behaves like interest. Check your myPTPTN statement for the word Ujrah before you assume anything.
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What changed in 2008
PTPTN's own FAQ sets out the timeline. The Ujrah loan took effect for new applications from December 2008. For borrowers who already had loans, the conversion from the conventional scheme to Ujrah began on 1 August 2009, and it was never automatic: a borrower has to apply through the myPTPTN app, receive an offer document with a new loan amount, and return it within 14 days. PTPTN explains the signature requirement bluntly: the two schemes rest on different principles, one conventional and one Shariah-compliant, so a fresh contract is needed.
The old scheme charged an administrative cost on the reducing balance that PTPTN now describes as ranging from 3% to 5%, with a maximum monthly cost equal to the loan principal times 3%, and with monthly instalments that rose progressively over the first five years. The Ujrah scheme charges a flat 1% a year. PTPTN's comparison table puts the saving at 47% to 49% of the conventional cost. If you want the background to why a percentage fee still raises eyebrows, the is it halal hub covers the same tension in other products, including buy now pay later and ujrah-based credit cards.
How the 1% ujrah is actually calculated
This is the part most graduates misread. The ujrah is not charged month by month on whatever you still owe. PTPTN fixes the total fee at the start of the repayment period using a single formula published on its repayment page: total ujrah equals the current loan balance, times 1%, times the repayment period in years. That lump sum is added to the balance and the result is divided into equal monthly instalments.
PTPTN's own worked example: a balance of RM19,432 with a new repayment period of 10 years gives an ujrah of RM19,432 x 1% x 10 = RM1,943.20, so the Ujrah loan amount becomes RM21,375.20. The repayment period itself is set by the size of the balance, and the maximum age at the end of repayment is 60.
| Ujrah principal | Repayment period | What that means for the fee |
|---|---|---|
| RM10,000 and below | 60 months (5 years) | Balance x 1% x 5 |
| Above RM10,000 up to RM22,000 | 120 months (10 years) | Balance x 1% x 10 |
| Above RM22,000 up to RM50,000 | 180 months (15 years) | Balance x 1% x 15 |
| Above RM50,000 | 240 months (20 years) | Balance x 1% x 20 |
Two timing rules matter. Repayment must begin within 12 months of your studies ending, without waiting for a notice, and PTPTN states that the monthly service charge is imposed from the 13th month. Borrowers who pay during the first 12 months pay no service charge on those payments. Pay before the 27th of each month if you want the transaction to show on that month's statement. PTPTN's comparison table shows what the switch to a flat fee saves across typical loan sizes.
| Loan amount | Period | Old admin fee at 3% a year | Ujrah at 1% a year | Reduction |
|---|---|---|---|---|
| RM5,000 | 5 years | RM474 | RM250 | RM224 (47%) |
| RM15,000 | 10 years | RM2,940 | RM1,500 | RM1,440 (49%) |
| RM48,000 | 15 years | RM13,829 | RM7,200 | RM6,629 (48%) |
| RM100,000 | 20 years | RM38,235 | RM20,000 | RM18,235 (48%) |
Why scholars accept Ujrah, and why some still frown at a percentage
Ujrah is a fee for a service. Classical fiqh allows a lender or an agent to charge for genuine work such as processing, record keeping, collection and administration, provided the charge is a fee for that work and not a return on the money lent. PTPTN says the 1% exists to cover the costs of managing and providing the loan, and the National Fatwa Committee accepted that framing in 2008. The design features that support it are the ones graduates rarely notice: the fee is fixed at the outset rather than accruing, it does not rise if you fall behind, and it is a flat 1% rather than a rate that tracks the money market.
The objection, raised by some scholars abroad and by cautious Malaysians, is that a fee for a service should reflect the actual cost of that service, and a cost does not naturally scale with the loan amount and the number of years. A RM100,000 loan over 20 years costs RM20,000 in ujrah while a RM5,000 loan over 5 years costs RM250; the paperwork is not 80 times harder. PTPTN's answer is institutional: the National Fatwa Committee approved the structure, PTPTN raises its funds through sukuk guaranteed by the government, and the fee is modest by any lending standard. The Federal Territories Mufti's office, in its Bayan Linnas series on PTPTN, treated the debt as a real obligation owed by the borrower and warned against the belief that it had been forgiven. Our reading: the structure is accepted by Malaysia's highest fatwa body, the fee is small, and a borrower who wants to be stricter can shorten the time the fee applies by settling early.
Reading your myPTPTN statement
Open the myPTPTN app (new registrations since 15 September 2025 go through MyDigital ID) and look at the loan account. The figure that matters is the current loan balance, which PTPTN defines as principal due plus the ujrah charged, less repayments received. If the account is titled as an Ujrah loan, the fee has already been baked into the balance as the lump sum above, so you will not see a new ujrah line appearing each month. If you still see the conventional scheme, the administrative cost is being added on the reducing balance and you should apply for the Ujrah conversion before anything else; PTPTN only allows restructuring or rescheduling on Ujrah loans.
- Ujrah conversion: apply in myPTPTN, receive the offer, return it within 14 days or the offer lapses and the balance is recalculated with any outstanding costs added.
- Balance confirmation and the Surat Pelepasan Hutang (loan release letter) after settlement are both issued through myPTPTN.
- Compensation (ta'widh) is separate from ujrah: on the Advance Payment Loan (WPP) it is 1% a year on the balance from the 9th month after the warrant date.
- Paying less than the scheduled instalment counts as arrears and can trigger enforcement and a CCRIS listing; ask for restructuring instead.
Exemptions, incentives and what has expired
Belanjawan 2026 narrowed the best-known incentive. From 1 January 2026, the full exemption for first class bachelor's degree graduates applies only to students from B40 and M40 households who graduated from public universities (IPTA), based on guardian or household income at the time studies ended. The other conditions remain: full-time study, completion within the period in the loan offer, no overlapping sponsorship, and an application through myPTPTN within 12 months of convocation. Only the degree portion is exempted; a combined diploma and degree loan still carries the diploma balance.
- Sarawak state incentive: a reduction of up to 30% of the outstanding balance for borrowers with a Sarawakian parent who have repaid at least 30% of the loan and completed their studies. PTPTN's example: RM15,000 borrowed, RM5,000 repaid, RM10,000 outstanding, RM3,000 written off, RM7,000 left to pay. No application is needed; PTPTN sends the list to the state.
- KPTiP (professional and industrial credential programme) for third and final year IPTA students: a 50% discount up to RM5,000 on completing the professional certification within the programme period.
- Biasiswa Anak eKasih PTPTN: from 1 January 2026, loans approved for eKasih-registered students on full-time diploma or bachelor's programmes at IPTA are treated as scholarships.
- General repayment discounts: PTPTN's media page shows the Belanjawan 2024 discount closed on 31 March 2024 and the 2023 round closed on 31 May 2023. No general discount was listed on the promotions page on 2 October 2026, which carried SSPN savings campaigns only.
Restructuring versus clearing PTPTN with a personal financing facility
A graduate who cannot manage the instalment has a cheaper tool than any bank: PTPTN's own restructuring. It extends the period up to age 60, sets the minimum instalment at an estimated 5% to 8% of gross income, charges no processing fee the first time (RM50, RM100, RM150 and RM200 for later rounds), and adds ujrah at 1% for the extension period only. Since 1 July 2015 you must first clear at least 50% of any arrears plus enforcement costs, takaful debt and stamp duty debt before the offer letter is issued.
Clearing PTPTN with an Islamic personal financing facility is almost always worse. PTPTN's fee is a flat 1% a year; bank personal financing is priced several times higher, as the effective rates in our Islamic personal financing comparison show, and the personal financing hub explains the Tawarruq contracts behind them. Even public sector schemes from Bank Rakyat or Bank Islam cost more per ringgit than ujrah. The one case where refinancing makes sense is a borrower still on the conventional PTPTN scheme who refuses to convert; converting is free, so that case should not exist. Never refinance a Shariah-compliant 1% fee into a conventional loan, whatever the bank's teaser rate.
Tax relief and zakat
LHDN's individual relief list for the current year of assessment has no line for PTPTN repayments. The education-related reliefs it does list are for fees you pay yourself (up to RM7,000, with a RM2,000 cap on upskilling courses) and for net deposits into Simpan SSPN (up to RM8,000). So repaying your own loan does not reduce your tax; saving in SSPN for your children does. If you pay zakat, the zakat tax rebate rules still apply to zakat you paid, not to PTPTN.
On zakat itself, the instalments falling due within the coming year are a short-term debt. Several state zakat calculators let you deduct debts due within the haul from your zakatable savings; others take savings at face value. Use your own state's calculator rather than a national rule of thumb, and see our zakat on income and savings guide and the zakat hub for the methods each state publishes.
The verdict for a borrower who wants to be strict
Confirm you are on the Ujrah scheme; if not, convert now. Start paying inside the first 12 months after graduation, because nothing is charged during that window and PTPTN says the service charge only accrues until the settlement date, so early settlement cuts the fee. Pay more than the instalment whenever you can, as PTPTN treats the excess as early settlement. Check whether the first class, Sarawak, KPTiP or eKasih provisions apply to you. Do not refinance into a bank facility, and do not wait for a discount that is not currently on offer. Facts checked against ptptn.gov.my, hasil.gov.my and muftiwp.gov.my on 2 October 2026.
Frequently asked questions
What does ujrah mean on my PTPTN statement?
Ujrah is the Arabic term for a fee or wage. On a PTPTN account it is the 1% a year service charge that covers the cost of managing and providing the loan, calculated once as balance times 1% times the repayment period in years and added to the amount you repay in equal instalments. It is not interest on the reducing balance and does not compound.
Is PTPTN riba?
The Ujrah loan is not treated as riba by the National Fatwa Committee for Islamic Affairs, which approved the structure on 28 July 2008, or by PTPTN's own Shariah framework. The older conventional scheme, with an administrative cost of 3% to 5% on the reducing balance, is the one PTPTN itself labels as not Shariah-compliant. Borrowers still on it can apply to convert through myPTPTN.
Is the ujrah charged on the whole loan or the balance?
On the balance at the start of the repayment period, multiplied by 1% and by the number of years in the schedule. PTPTN's example uses RM19,432 over 10 years for an ujrah of RM1,943.20. If you settle early, PTPTN states that service charges only accrue to the settlement date, so you pay less than the full lump sum.
Can I still get the first class exemption in 2026?
Only if you fit the narrowed rules from Belanjawan 2026: a full-time bachelor's degree with first class honours from a public university, a B40 or M40 household at the time your studies ended from 1 January 2026, completion within the stipulated period, no overlapping sponsorship, and an application in myPTPTN within 12 months of convocation.
Should I pay off PTPTN with a bank personal financing?
No. PTPTN charges a flat 1% a year; Islamic personal financing from Malaysian banks costs several times that in effective terms, and a conventional loan would replace a compliant contract with riba. If the instalment is unaffordable, apply for PTPTN's restructuring, which can stretch repayment to age 60 at 1% for the extension and is free the first time.
Compare providers in your state
See side-by-side comparisons of Shariah-compliant products, or let our matcher recommend the best options for your situation.
Do PTPTN repayments reduce my income tax?
No. LHDN's relief list has no entry for PTPTN repayments. The education reliefs that exist are for your own course fees, up to RM7,000, and for net deposits into Simpan SSPN, up to RM8,000. Zakat you pay is treated separately as a rebate against tax payable.
