Students paying tuition with a credit card will now face extra fees at the checkout, and those planning on using VISA will have to find an alternative payment method altogether.
As of Aug. 15, the entire USF system no longer accepts VISA for payment of tuition. Though American Express, MasterCard and Discover can still be used, an additional 2.5 percent of the entire payment will be tacked on to all credit card transactions made for tuition. Previously, the fee for using credit cards was a flat $10, but the school says credit card processing fees are costing it more than that.
According to the “Schedule of Fees” from 2009, about 150,000 transactions were made with VISA that year — more than any other company.
According to University Controller Jennifer Condon, VISA prefers to charge students two separate transactions — one for the amount of tuition and one for the fees. The USF cashier’s office prefers a bundled payment that lumps tuition and extra fees together and works better for the majority of companies. The school was able to make it work with VISA until the 2.5 percent fee kicked in and increased costs.
Changes for card usage came with hiked expenses for the university system. Prior to the change, the university spent more than $800,000 from reserves to pay licensing fees from credit card companies. The $10 fee for every credit card use for tuition didn’t add up to the $800,000, resulting in approximately $620,000 directly lost.
“The irony is that the $800,000 subsidy last year was almost a directed subsidy to a certain group of students,” Condon said. “So if you didn’t pay with a credit card, you didn’t get the benefit of that subsidy.
The fee amount for the 2013 – 2014 school year was determined by the credit card company licensing and personnel costs. According to Condon, St. Petersburg was the only USF campus that continued to rely on credit card usage in the cashier’s office.
The extent of credit card usage over time will determine the percentage charged for coming years. If students system-wide reduce their usage, the fee may drop to somewhere between 1.5 and 2 percent of tuition.
“We’re basing our estimates on history,” Condon said. “If the 2.5 ends up being high, we would reduce the fee. If it ends up being low, that would be up to the vice president’s office to determine what to do with it.”
Chances of a fee increase are small, as rates for credit card companies rarely change.
Credit cards can still be used to purchase parking passes and meal plans in the cashier’s office or online without a fee and VISA will still be accepted for anything other than tuition and student fees.
Those looking to escape the fee can pay with cash, check or money order at the cashier’s office. Online options include virtual e-checks or debit card payments, both of which can be completed for free. Scholarships are not affected unless providers, such as the U.S. Army, pay the university with a credit card.
