The 23-year-old joined Spurs from the German outfit last January, but has never been a first-team regular and has started just once under new boss Tim Sherwood.
Schalke are keen to re-sign Holtby, but have admitted that they cannot afford to buy him permanently, and The Mirror now claims that PSV's interest in him has increased.
The Dutch giants, who failed with a loan bid, have returned with a cash offer for the £8m-rated midfielder. Sherwood reportedly met with technical director Franco Baldini on Friday to discuss those players who were surplus to requirements and concluded that Holtby could leave, but not on loan.
Holtby has scored three goals in 21 Lillywhites appearances this season.