The new swipe fees are clamping down on banks, causing them to lose billions in fees each year. Now, colleges and universities are clamping down on students using credit cards to pay tuition, fees and parking fees. Universities, such as UCLA, say it will begin charging students who pay their tuition with credit cards a 2.75% credit card processing fee. The university states it costs the educational institution $6.5 million in credit card processing fees each year.
This will especially hurt lower income students, who may need credit to make ends meet. With 79% of revenues in student accounts coming from credit cards, this poses another problem for the change in policy. Stanford University previously charged a similar amount, but stopped doing so because it turned out to be too large a burden on their student body. But, students in the California state university system will see a drop in this surcharge from 2.9% to 2.75%.
The problem is that students are also expecting an 8% hike in tuition fees to help offset the state budget issues. According to Emily Resnick, the UCLA student body president,“Especially at a time when tuition is increasing substantially and steadily year after year, forcing students to pay yet another additional fee is unnecessary.”
In addition to the surcharge for using credit cards, students are also not responding well to the short notice. The announcement went out to students in early June and is expected to kick in on August 1.
Credit Cards Accepted
Adding insult to injury, students who continue to pay with credit cards can no longer use their Visa card. Because Visa does not allow the institution to charge a percentage of the amount being charged, the university will not accept it as a form of payment. Credit cards, such as Discover, American Express and MasterCard, however, will still be accepted.