Debt Composition and Attitude towards Education Loan among Malaysian Graduates

A worrying trend in the Malaysian higher education environment is that students graduating not only with diplomas or degrees of their disciplines but also with debts. Graduates with debts becomes a serious issue when many of the graduates faced difficulties in repaying not only their education loan but also other debts that they create since entering the job market. This paper examines the debt composition of 186 graduates and their attitudes towards education loans. The education debt-to-income ratio is found to be in the range of 1.8 percent to 12 percent; where a ratio beyond 8 percent is deemed unsafe.