Global Payments

Easing Cross-Border Tuition Reconciliation Pain

Class is in session. With over 1 million international students seated in U.S. colleges and universities these days, untangling tuition acceptance complexities can be a real grind. In the new Global Payments Architecture Report, St. John’s College CFO Michael Duran speaks with PYMNTS about how the school reduces outstanding debts by streamlining receivables and quickly reconciling student accounts.

The number of international students on U.S. college and university campuses has been on an upswing over the last decade, increasing from 3.3 percent of total students in the 2007–2008 academic year to 5.3 percent in 2016–2017, according to the Institute of International Education (IIE).

These universities and colleges are adjusting their operations to address overseas visitors’ global payments financial needs as that number continues to grow. Some still struggle with reconciliation issues like matching tuition payments to the intended student. As such, many higher education institutions are turning to digital receivables to account for international tuition transfers, track and reconcile payments, expedite payment receipt and reduce outstanding debts.

Private liberal arts institution St. John’s College is familiar with the challenges involved in addressing international students’ financials. Such students make up 18 percent of the student population in both its Annapolis, Maryland, and Santa Fe, New Mexico, campuses.

The college specializes in Great Books teachings, focusing on the foundations of Western literature and culture and featuring seminar-style classes. According to Michael Duran, St. John’s treasurer and chief financial officer, this curriculum is one of the key reasons international students choose to apply.

“It’s a very rigid program that we provide, and it seems to be a very attractive one to our international students,” Duran said.

In a recent interview, he discussed the college’s method for handling overseas tuition payments and how receivables solutions help keep its budget in strong shape.

Payments — And Studies — By The Books

Most of St. John’s international students come from Asian nations, including China, South Korea and Nepal. They might need to use their local currencies to make tuition payments, so the college uses Flywire to receive such overseas tuition transfers. Its global payments solution then converts foreign currency payments into USD.

“[This] eliminates the need for us to deal with conversion rates and the timing of conversion changes, rate changes and things like that,” Duran said.

The system is designed to quickly receive and convert international payments, allowing St. John’s to eliminate outstanding debt and improve its liquidity.

“Being able to get the money quickly, in a timely basis, helps our cash flow,” he said. “Any time we can get cash fast into the bank and … mitigate cash ups and downs throughout the year [is helpful].”

A Reconciliation Fix

St. John’s uses a wide array of solutions to receive tuition from its large population of international attendees. This includes wire transfer, which several students and their families still use to manage their payments.

Though used for years to transfer funds between borders, Duran noted that payments made via wire transfer can create reconciliation issues if information is missing or incomplete. For example, the college might have to scramble to determine where the money should be applied if the intended recipient information is missing.

“We’ll sometimes get the name of the uncle who sent the money, but it doesn’t say who the student is,” he said. “So, it might take a little bit of research to figure out where the money belongs so we can put it in the correct student’s account.”

Wire transfers may create reconciliation and receivables issues, but its low fees make it appealing to some students and their families.

Creating A Smoother Path To US-Based Education

Making cross-border tuition payments can be challenging for international students, overseas families and receiving institutions, but emerging receivables solutions are now reducing friction. In addition to tuition, St. John’s also works to help these students address the paperwork they need to pursue U.S. studies.

Visa applications can be “cumbersome,” Duran said. The college has stepped up its efforts to help international students with the process, ensuring documentation is in order and that they are prepared for interviews at U.S. embassies. This kind of assistance can make a U.S.-based college or university like St. John’s seem more appealing to prospective international students.

“Being able to provide assistance to [international students] is one of the big things that has helped us to attract [them] and make it easier to study in the U.S.,” Duran added.

For students leaving their home countries to pursue education abroad, documentation and tuition support can give them more time to focus on classroom lessons. They are there to become experts in their fields of study, after all, not in the nuances of international payment challenges.




The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.