Universities in the UK could collectively be paying up to £80m as a result of the credit card transaction fees associated with international tuition payments, according to statistics from global payment giant, Western Union.
The research also found that each university could also lose up to 67 working days per year as a result of the extra staff time and resources required to process international tuition fee payments.
The data was based on a 1.39% transaction fee charged on a payment made by credit cards internationally.
“Paying for a term’s tuition fees is likely to need a little more verification and traceability for a student’s protection”
Among the 100 admissions and finance teams surveyed at higher education institutions across the UK, nearly half (44%) of the survey respondents found that having to pay these transaction costs for international payments was the biggest challenge when processing international tuition fees.
And close to one third of respondents (30%) said that their biggest challenge lies with the time and resources spent to process the international tuition fees.
Western Union’s research found that each institution spends on average 10 and a half hours each week on matching, process and reconciling payments from international students – the equivalent of 67 working days in a year.
There were 438,010 non-UK domiciled students in UK higher education in 2015/16, according to HESA statistics.
Despite the survey’s findings, many of the challenges associated with international student tuition fee payments are out of the institution’s control, according to Pete French, international recruitment officer at Coventry University.
“Students may be faced with fluctuations in exchange rates, the availability of foreign currency and other legal restrictions that govern the transfer of monies across international borders,” he told The PIE News.
“We find that they are often greater challenges than simply the method used to process a transaction.”
In addition, 21% of respondents said that, despite the challenges, they do not believe their universities are fully prepared to accept payments from international students.
And with the growing number of alternative ways that students can pay their tuition fees, like e-wallets or through online platforms, the uptake has been fairly slow, with only 5% responding that their institutions offer these options.
“Students may be faced with fluctuations in exchange rates… and other legal restrictions”
French at Coventry University said that it is important to ensure that “any payment method is secure and convenient for the customer”.
“Paying for a taxi ride with an app is one thing. Paying for a term’s tuition fees is likely to need a little more verification and traceability for a student’s protection,” he said.
Read more about international student tuition fee payments in an upcoming article about how international education is harnessing financial technology, in the next edition of The PIE Review.
