E-payment as advantage: one online payment pioneer's 'solution evolution' may form a road map for your own IHE - Online

University Business, Feb, 2003 by Tim Goral

For recent generations of college students, Internet usage, like cell phones and video games, has become almost second nature. So, it's no surprise that colleges and universities would pick up on what Amazon.com and other online businesses learned years ago: Make it easy to pay for goods or services online, and everyone wins.

Right now, in fact, e-payment systems are gaining acceptance at schools across the country. The University of Colorado, Boulder, for example, began using e-payment technology in 2002 through the Net.Pay product suite from Sallie Mae (www.salliemae.com). The Web-based solution enables students and parents to receive tuition bills online and pay them using their checking or savings account. Likewise, the University of California chose the CyberSource Payment Service (www.cybersource.com) to give students and alumni an easy and secure way to handle school fees online.

Camden County College, one of the first colleges in New Jersey to launch its own Web site several years ago, added e-payment capabilities operated by VeriSign (www.vefisign.com) to its online services last summer. Blinn Community College (TX) introduced infiNET Solutions' QuikPAY system last year (www.infinet-inc.com). The QuickPAY single sign-in feature enables students to log in at the community college's home page, and then go to the payment site without reentering their information.

A PIONEER

Still, while many IHEs are now hopping on the bandwagon, there were those--as there always are--who were ahead of the curve, and whose choices since can form a model for your own e-payment decisions. Indiana University-Purdue University Fort Wayne (IPFW) could indeed be considered a trailblazer in electronic payment forms, The school was one of the first to offer tuition payment by credit card back in 1969, says Assistant Comptroller Mark Franke, and administrators there have been working hard to provide an extra level of service and convenience to IPFW's nearly 12,000 students.

"We're a commuter school with about half full-time traditional students and half non-traditional or older students, many of whom work full-time besides attending classes," says Franke. "It's always been important for us that students could be able to make payments as easily as possible."

But even with the convenience of credit cards, getting to the bursar's office during business hours was difficult for students who worked during the day. "We were hearing from many people who wanted to call in and pay without having to come out here and physically give us a card," Franke says.

So the school established a call center to take the credit card information over the phone, which then had to be updated manually in the student information database.

"That was just a hassle for everybody," recalls Franke. In 1996, IPFW installed a telephone voice-response unit to handle the credit cards. Although the voice-response system was more convenient for students, it created an additional headache for the school. "It didn't operate in real time, so we had to do a nightly exchange with our database," Franke says.

Offering online payments was an inevitable next step. "We had been taking credit card payments for some time, and the school was already moving down the path of e-commerce in other areas, so the administration understood the importance of e-payment to the students and the school," says Franke. "Finally, in 1998, we switched to e-payment." (IPFW chose TouchNet's Payment Gateway solution; www.touchnet.com).

The new solution linked the campus system to the financial networks of most commonly used credit card processors to give IPFW real-time credit card payment processing. The school could maintain its current banking relationships and, importantly, is charged no additional per-transaction fees.

PRIORITY: EASY INTEGRATION

As they considered their short list of e-payment vendors, says the assistant comptroller, "It was important that our e-payment solution plug right into our mainline SCT software." As an SCT Plus campus, Franke says the school was already familiar with some of TouchNet's other student Web services, such as online registration. "We were aware that the company was working on the e-payment system, so when they introduced it, we knew we wanted to use it because it would integrate with our student information system. The fact that it plugged into the existing system as a module, rather than as a third piece of software, was a big selling point to administrators," he says.

Because of the integration with the student information system, students had instant access to and greater control over their financial responsibilities. "A student who makes a payment by Web or by voice has his records immediately updated in the main SIS database," Franke explains.

SECURITY CONCERNS

Yet, as the school switched from in-line to online payments, it faced new risks and potential for fraud. They needed a system with compliance monitoring capabilities that would help the school assess its payment system's security risks and compliance with processing rules and regulations. The e-payment system they were looking at had such features, and it offered protection against Web site hijacking, firewall vulnerabilities, and identity theft.