Islamic Student Financing Back Securitization in Malaysia

In each country government have their own system to provide facilities to finance their students in pursuing higher education. Many countries provide mortgage type of loan to student for them continue their studies. Previous research has proven that higher default rate occur for those country implement this type of loan. Many scholars studies to address this issue to minimize default rate. Government has financial constraint to continue giving financial assistance to the student because they have to allocate the budget to other allocation such as public health and infrastructure. This article to propose new framework as alternative to previous mortgage type loan. This new Islamic student Financing Baked securitization framework is new and become the first in the world. This will benefit for both government and Malaysian because the student pursue the studies with this financial assistance without to worry of constraint budget. It also to propose high quality grade of Sukuk that comply with global shariah principles. According to the forecasting of this research National Higher Education Fund Corporation no need to depend on government to fund the students for higher education loans by 2038.