UK Universities Paying Out Tens of Millions in Transaction Fees to Receive International Tuition Payments
August 01 2017 - 3:00AM
Business Wire
New research from Western Union reveals the
huge financial and human resources cost faced by UK universities
receiving payments from international students*
- Survey among 100 U.K. universities
reveals international tuition payments made by credit card incur an
average 1.39 percent transaction fee
- With 438,000 international students in
the U.K., the collective bill in credit card fees for universities
could be over £80 million a year
- Moreover, 67 working days may be lost
annually per institution to university staff matching, processing
and reconciling overseas payments
U.K. universities could be facing over £80 million in credit
card transaction charges every year while receiving and processing
tuition payments from international students, according to new
research* from Western Union, a leader in global money transfer and
payments services. In addition to the monetary cost, the survey
found that nearly ten and a half hours a week are lost to matching,
processing and reconciling payments from international students -
the equivalent of 67 working days every year.
Western Union’s research, in which 100 finance and admissions
teams at universities across the U.K. were surveyed, shows that
nearly half (44 percent) said the charges incurred from payments is
the biggest challenge their institution faces when processing
international tuition fees. Nearly a third of those surveyed (30
percent) said the time spent and human resources required to
process overseas payments was their biggest challenge when
receiving international tuition fees.
Today, nearly one fifth (18 percent) of the U.K.’s student
population is from overseas, accounting for 12.7 percent of the
total higher education income received by U.K. institutions,
according to the Higher Education Statistics Agency. With the
higher education landscape becoming increasingly globalised,
however, universities need to be prepared for an expected increase
in international students, with the Institute of International
Education predicting that there will be 75 percent more students
studying abroad by 2025.
With such anticipated growth in international student
populations, universities will likely be faced with more costly
transaction charges and an increasingly cumbersome administrative
burden. However, one fifth (21 percent) of those surveyed do not
feel their institutions are fully prepared to accept payments from
international students. Furthermore, despite the growing popularity
of e-wallets and alternative payment methods, few respondents (5
percent) cited that their institutions offer these options to
students – demonstrating a distinct lack of adoption within the
industry.
“Managing payments from international students can be a complex
and time-consuming process for U.K. universities,” said Western
Union’s President of Global Payments Jean Claude Farah. “This new
research shows the real challenge faced by universities and
colleges. In addition to the charges they may incur, many also lose
valuable staff time matching and processing payments made by a
variety of methods depending on the student’s country of
origin.”
“With funding and resources an ongoing concern for universities
across the U.K. and international students becoming a more
significant income stream, having access to an efficient and
cost-effective process to accept payments from around the globe has
never been more important,” Farah said.
Western Union recently launched its enhanced GlobalPay for
Students platform, which has been developed to improve the way
universities reconcile, refund and track payments from
international students, allowing clients to receive payments from
multiple platforms and view all payment activity on one dashboard.
The platform is designed to help universities simplify the
reconciliation of incoming international payments, which can be a
complex and time-consuming process. The mobile-first interface has
also been developed with student input to improve the user
experience.
Notes to editors
*
- Based on 1.39 percent average
transaction fee on payment made by credit card.
- Calculations based on tuition fee of
£13,000 and 438,000 non-U.K. domiciled students in higher education
– student numbers from U.K. Council for International Student
Affairs.
- The study was conducted by OnePoll
between 9th June - 22nd June 2017 and polled U.K. adults with
finance and admissions responsibilities in universities/higher
education institutions. Participants were recruited online and were
paid to participate.
About Western Union
The Western Union Company (NYSE: WU) is a leader in global
payment services. Together with its Vigo, Orlandi Valuta, Pago
Facil and Western Union Business Solutions branded payment
services, Western Union provides consumers and businesses with
fast, reliable and convenient ways to send and receive money around
the world, to send payments and to purchase money orders. As of
March 31, 2017, the Western Union, Vigo and Orlandi Valuta branded
services were offered through a combined network of over 550,000
agent locations in 200 countries and territories and over 150,000
ATMs and kiosks, and included the capability to send money to
billions of accounts. In 2016, The Western Union Company completed
268 million consumer-to-consumer transactions worldwide, moving $80
billion of principal between consumers, and 523 million business
payments. For more information, visit www.westernunion.com.
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