It’s hard to quantify precisely, but COVID-19 clearly took a toll on enrollment at schools and colleges over the past few semesters. A combination of health concerns, remote learning restrictions, and campus closures kept many students from returning to campus and dealt a financial blow to the schools themselves, prompting the higher ed industry to seek out urgent digitization initiatives to increase operational efficiency while also reducing costs.
“Every institution we work with had to move to digital solutions very, very quickly, not just in terms of delivering content but also with things like being able to receive payments,” said Sharon Butler, executive vice president of education at vertical payments provider Flywire.
Butler was discussing the findings of the latest Smart Receivables Playbook with PYMNTS. One of the key observations from that report was the impact of the lack of international students enrolling at many U.S. schools. International students and the money they bring in are critical to the financial solvency of many private institutions.
Read more: New Study: Half Of AR Chiefs In Education Sector Want Schools To Digitize Payments
“We help institutions by removing the friction for payments of international students,” Butler said. “The schools need that money, so let’s not make it difficult.”
As expenses have risen for all students, more schools have started to digitize processes to make the prospect of studying more feasible, which means transforming the payments process to make things easier for families to afford.
Butler said the lack of international students has been especially harmful to two-year institutions, which tend to be more reliant on the income they bring. She explained that many of those institutions have a larger percentage of international students, who see them as a stepping stone to get into and later stay in the U.S.
Related: 36 Pct Of College Hopefuls Blame Loan Application Snags, Payment Frictions On Old-School Systems
A Seamless Win-Win
Those long-term goals begin with graduation and get more students to that point. Flywire has simplified the payment process by making it easier to transfer funds and more affordable via a range of payment plans.
“Many institutions are open to figuring out how they can make sure students are willing to come here,” Butler said. “And that means not just providing an easy way to pay but also breaking it into small installments. That way, it provides more accessibility for many families.”
Not only does digitization help students, but it also makes life much easier for the schools and universities themselves. That’s because it allows them to automate business operations and eliminate many of the inefficiencies that drag on their resources.
Butler said all sorts of operational efficiencies plague educational institutions. An example, she said, is the bursar’s office. In many cases, if a student falls behind in their payment, the process of chasing that up is very complex and usually involves someone spending time running reports and calling individuals.
“The people in the bursar’s office want to help students as much as they can, they want to be able to reach out to you and figure out strategies to ensure your tuition is paid,” she said.
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Flywire’s software helps enable this by integrating payments with student information systems to act upon events as they happen. So if a student does miss a payment, it can automatically reach out to that person with the offer of a new payment plan to help them catch up. Not only is there less work involved for the bursar’s office, but it also ensures a higher level of service that casts the school in a better light, too, Butler believes.
“It looks like you’ve got an institution that really cares and is trying to cooperate,” she said. “And for staff, it frees them up so they have more time to spend with the people who really need it. Automation and digitization of payments can really help schools get to the next level.”
Further reading: Flywire’s Payment Volume Surges 85 Pct As Pandemic Pressures Ease
Schools do experience some friction integrating these new digital systems, but Butler said the tougher challenge is really just convincing them to adopt new IT systems in the first place. Once they take the plunge, the digital transformation proceeds quite smoothly, she insisted, with most institutions seeing good results within around six to eight weeks of getting started.
“It’s not like they’re starting from scratch,” she said, noting that many schools already rely on ERP software or student information students such as PeopleSoft. “Schools simply have to build in the sort of flags and behavior they want to operate on.”
“Taking the time and the investment to do this will help institutions recruit more students, save more students and keep staff happier too,” she added.
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