Higher education is becoming more accessible through the use of technology, in order to provide access and flexibility for students who may have other life constraints that can interfere with the pursuit of knowledge. Along with greater accessibility, technological advances have also made college courses more affordable. Credit costs are greatly lessened through online classrooms and digital study materials, but many of the students who engage in this form of schooling will also utilize student loans to offset some of the costs.
Although FAFSA handles the initial awarding of these loans, financial departments and accountants within the university do still manage the dispersal of funds, including:
Although many of these actions may appear to happen virtually, there are still tangible funds that are being managed and transferred. Many college financial departments already rely upon ACH and other payment processing services, both to manage individual student loans and to regulate the actual out of pocket payments that students may be making to the university. This can include:
These actions not only facilitate accounting from the perspective of the college, but can also help students become prepared for the road ahead.
While the prospect of graduation is an exciting time for any student, it can also mark the start of a countdown clock for repayment on the loans. Beyond the point of graduation, students have six months to either re-enroll in more classes or to begin repayment. While some universities will offer guidance in regards to effectively achieving repayment, many students can find that they are left on their own to navigate this event. Automated payments and ACH services are becoming very popular with both lenders and students since this can provide a convenient means for repayment, without the need for constant monitoring. Recently graduated students should enquire with their lenders regarding this options, as the automation of payments can also mean that lenders become more amenable to consolidation. The reasoning behind the ability to enact these types of payment negotiations do result from the fact that ACH works as:
These assurances, along with the backing of the national network for automated payments can promote some leverage for reducing interest costs and negotiating a manageable monthly payment. In the education industry, institutions, backing lenders, and students can all benefit from better payments processing, as this shifts the focus of learning back to advancement, rather than just keeping up with the bills of prior courses.
Posted in ACH on Apr 14, 2015