Colleges and universities have millions of dollars tied up in past-due tuition and fees, and the majority say that their past-due accounts are increasing. To better understand the challenges institutions are facing related to receivables, ECSI partnered with Higher Ed Dive to survey 150+ higher ed leaders. From that survey, ECSI and Higher Ed Dive Studio produced an in-depth report “Exploring Academia’s Unseen Debt Crisis: Recouping Millions in Unpaid Accounts at Colleges and Universities.”

In a webinar with past-due accounts receivable experts, ECSI unpacked report and survey data that highlights the ways higher ed institutions across the nation are managing their past-due tuition and fees.

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The webinar outlined strategies to help colleges and universities recoup these valuable dollars while giving students a compassionate, proactive path to retention and degree completion.

Here are the key takeaways from the survey data deep dive:

Accounts Receivables (AR) is a Crucial Piece of Student Financial Literacy

Students need support throughout their entire educational journey, including if and when they face financial hardship. Survey data shows that institutions struggle to document and execute multi-step student outreach, and survey respondents shared that they’re not always sure what their individual or team role is in supporting past-due students. AR should be deeply integrated into student financial literacy and wellness. Consider compliant and compassionate outreach before, during, and after financial difficulties.

Early Outreach is Key

The sooner an institution can reach out to past-due students, the better the outcome for the student and the college or university. Many institutions don’t have the bandwidth to begin outreach to students with past-due accounts until after the term ends. But research shows that institutions that perform early intervention have higher success in supporting students who want to stay in school.

Compliance is Complicated

Higher education payments and past-due tuition and fees are coming under increasing scrutiny from regulatory bodies. Regulations such as the recent Transcript Withholding Ban and Fair Debt Collection Practices can add compliance pressure to accounts receivables teams. According to the Consumer Financial Protection Bureau (CFPB) in their Fall 2022 Supervisory Highlights Student Loan Servicing Special Edition, The CFPB “determined that blanket policies to withhold transcripts in connection with an extension of credit are abusive under the Consumer Financial Protection Act and directed institutional lenders to cease this practice.”

Keeping up with compliance is a critical but time-consuming function of AR offices. Our survey showed that only 40 percent of colleges and universities have had their past-due outreach policies reviewed by inside general counsel. During the webinar, attendees indicated that many don’t even have a documented policy.

Automation Improves Outcomes

Survey respondents, echoed by webinar attendees, cited insufficient staff and resources as one of the greatest obstacles to completing AR outreach before a student leaves school. The majority of respondents (74 percent) say their teams spend up to 49 percent of their time attempting to recover delinquent tuition and fees.

Colleges and universities are looking to implement automated and standardized processes to alleviate staff bandwidth and better support students. AR management tools like ECSI’s RecoverySelect offer multi-touch, white-glove outreach, robust reporting, and automated agency placements. The proactive AR management program also protects students from negative credit bureau reporting and aims to keep students enrolled and out of collections.

Learn more about the latest trends in past-due receivables in the On-Demand webinar, or download the full survey report, here.