2008 Woodie Awards
University adds fee for credit card users
By: Brad Canze
Issue date: 3/14/08 Section: News
Brent Buesking usually pays his CMU bill with a Visa card.
But in a few months, the Rockford junior and any other student who pays their tuition and fees to Central Michigan University will have to find a new method of payment.
Starting July 1, CMU will be charging students a convenience fee to make online credit card payments. It also has terminated its agreement with Visa.
"I guess I'm going to have to pay through electronic checks or something," Buesking said.
The fees are being assessed to students and employees in the form on a 2.75 percent convenience fee of every payment made with a credit card for on-campus accounting. Off-campus programs and costs, such as application fees for new students, will not be applicable.
"It was determined that the university would be no longer able to sustain the convenience fee that is charged to allow students and families to use their credit cards to make payments," said Steve Smith, director of media relations.
Fees charged to the school by credit card companies for payments made to student accounts cost the school $583,000 last year, and are estimated to cost nearly $1 million this year.
"It's a cost that we've been watching for a number of years," said Barrie Wilkes, associate vice president of financial services and reporting. "The cost keeps going up."
Visa Inc. has a policy against such percentage-based fees, and only complies with flat fees that are the same regardless of payment size.
"So because of that, we cannot accept Visa for student accounting payments," said Amber Loomis, receivable accounting systems analyst. "Really, that's a Visa decision that's affecting CMU."
Payments made with debit cards also are subject to the 2.75 percent cost.
"We're advising our customers, if they are going to use a debit card, to use an e-check so they avoid the fee," Loomis said. "On a positive note, CMU is not the first university to do this in Michigan. There are many other universities doing this."
The decision to add the fee places CMU on an existing list of public universities in Michigan that charge a credit card convenience fee, including Eastern Michigan, Michigan State, Wayne State, Grand Valley and Saginaw Valley State University.
Staff Reporter Kyle Fitzsimmons contributed to this report.
news@cm-life.com
But in a few months, the Rockford junior and any other student who pays their tuition and fees to Central Michigan University will have to find a new method of payment.
Starting July 1, CMU will be charging students a convenience fee to make online credit card payments. It also has terminated its agreement with Visa.
"I guess I'm going to have to pay through electronic checks or something," Buesking said.
The fees are being assessed to students and employees in the form on a 2.75 percent convenience fee of every payment made with a credit card for on-campus accounting. Off-campus programs and costs, such as application fees for new students, will not be applicable.
"It was determined that the university would be no longer able to sustain the convenience fee that is charged to allow students and families to use their credit cards to make payments," said Steve Smith, director of media relations.
Fees charged to the school by credit card companies for payments made to student accounts cost the school $583,000 last year, and are estimated to cost nearly $1 million this year.
"It's a cost that we've been watching for a number of years," said Barrie Wilkes, associate vice president of financial services and reporting. "The cost keeps going up."
Visa Inc. has a policy against such percentage-based fees, and only complies with flat fees that are the same regardless of payment size.
"So because of that, we cannot accept Visa for student accounting payments," said Amber Loomis, receivable accounting systems analyst. "Really, that's a Visa decision that's affecting CMU."
Payments made with debit cards also are subject to the 2.75 percent cost.
"We're advising our customers, if they are going to use a debit card, to use an e-check so they avoid the fee," Loomis said. "On a positive note, CMU is not the first university to do this in Michigan. There are many other universities doing this."
The decision to add the fee places CMU on an existing list of public universities in Michigan that charge a credit card convenience fee, including Eastern Michigan, Michigan State, Wayne State, Grand Valley and Saginaw Valley State University.
Staff Reporter Kyle Fitzsimmons contributed to this report.
news@cm-life.com
Viewing Comments 1 - 3 of 3
John Denny
posted 3/14/08 @ 8:16 AM EST
From Mastercard's Merchant Manual:
"9.12.2 Charges to Cardholders
A merchant must not directly or indirectly require any MasterCard cardholder
to pay a surcharge or any part of any merchant discount or any
contemporaneous finance charge in connection with a MasterCard card
transaction. (Continued…)
Some guy
posted 3/14/08 @ 12:27 PM EST
Hmm...every processing company i've seen uses a percentage fee for visa not a flat fee....
Fasting
posted 3/14/08 @ 7:08 PM EST
John Denny's comment is correct. I have known about it for many years and I am surprised by how many merchants violate this policy. Many colleges are doing things to cut their costs. (Continued…)
Post a Comment