New regulation reduces credit card payments by half

Credit card payments of student accounts have decreased by more than half after the university implemented a new credit card policy this fall that card users are required to pay a convenience fee for student account payments, a university official said.

Cheryl Wilson, associate vice chancellor and controller, said credit card payments accounted for 54 percent of student account payments in August 2007 as opposed to 12 percent of payments in August this year. Check and automated clearing house payments rose from 44 percent of student account payments to 82 percent in the same time span, Wilson said.

Wilson said the decrease in credit card payments was expected after reviewing changes that other universities experienced when similar policies were implemented.

“Card users who want to avoid the convenience fee are now paying with checks,” she said.

According to a letter mailed to students late in the spring, TCU paid $1.4 million in credit card processing fees last year, a payment the university will discontinue this year to move those funds to the financial aid budget.

In addition to requiring credit card users to pay convenience fees, the university no longer accepts Visa for student account payments.

Visa doesn’t allow merchants to charge a convenience fee only on credit card transactions while not charging fees on other payment methods, Wilson said. Other credit card companies – MasterCard, Discover and American Express – do allow the merchant to charge a convenience fee for credit card transactions while not charging a fee for other payment methods, Wilson said.

The Visa rules for convenience fees were considered but were not the reason in changing the university’s credit card policy, Wilson said.

“That decision was made to reduce the university’s expenses by over $1 million annually,” Wilson said.

Sophomore radio-TV-film major Sean Noack said the new payment system is a nuisance. Noack said his family lost the ability to gain airline miles when TCU stopped accepting Visa, and now his father has to remember to write a check and mail it to him each month.

“It takes time out of my dad’s day for him to write a check and mail it or transfer the money to my account so I can write a check,” Noack said.

Michael McGraw, junior accounting and finance major, said the new policy is not ideal.

“I don’t believe it was necessarily fair,” McGraw said. “My parents have to pay for processing fees, and I don’t see the benefits of more money for financial aid because I don’t receive financial aid.”

Wilson said when the announcement was made, she received half a dozen complaints from people who were upset about the change, but since then hasn’t received any.

Students like McGraw are getting used to the new rules.

“My parents still use a credit card to pay tuition bills, but they are making the best of it,” McGraw said.