ó Not a lot of people pay college tuition bills with a
credit card. But some do ó whether for convenience or
to get those nice rewards points.
didnít always charge a "convenience fee" for
people who pay their bills with credit cards. But in
recent years the number of families using credit cards
started to add up to a point where colleges say they can
no longer afford to absorb the transaction cost.
the majority colleges have begun to protect themselves
against the fees that card processors charge them by
requiring parents and students to pay an additional fee
of about 2.62 percent for using a credit card.
University of Pittsburgh, Duquesne University and
Carnegie Mellon University all accept credit card
payments and they all charge transaction fees, although
officials at those schools discourage the practice of
using credit cards for college expenses. They also say
the universities make no profit from the transaction
fees they charge.
Fedele, a spokesman for the University of Pittsburgh,
said Pitt does not profit from convenience fees. The
university does not directly accept credit cards as
payment for tuition, room and board, and fees. A
third-party vendor processes payments when made through
PittPAY, the institutionís online payment program. The
vendor charges a 2.75 percent fee for its use.
discourages the use of credit cards for these types of
payments because the terms of credit card companies are
usually less favorable to borrowers than traditional
student loans," Fedele said. "While we canít
speak for other schools, absorbing the credit card fees
can run into hundreds of dollars per student and
colleges and universities across the nation are under
pressure to keep costs down."
Universityís vendor is Nelnet Business Solutions,
which charges a service fee of 2.55 percent when
students or parents pay with a credit card online,
according to Rose Ravasio, the universityís
spokeswoman. She said at this point in the fiscal year,
there have been 440 credit card transactions on tuition
accounts. Last year at this time, there were 442.
Carnegie Mellon University, spokesman Ken Walters said
credit card usage accounts for about 1.5 percent of all
payments. "There has been little change in usage
since CMU began offering this option in 2013. We
discourage the use of this service in general, but made
it available after receiving consistent requests from
our bill payers," Walters said.
at the University of Pittsburgh said he was unable to
provide information on parents and students who pay
college costs at Pitt with credit cards.
who pay tuition bills with a credit card incur an
average "convenience fee" of 2.62 percent,
according to a new CreditCards.com report, which
surveyed 300 of the largest U.S. public, private and
community colleges. That translates to $262 for every
$10,000 of tuition.
colleges are the most fee-friendly. Out of the 100
largest community colleges surveyed, 97 percent accept
credit cards for tuition payment and only 8 percent of
them charge convenience fees. By contrast, 93 percent of
public universities and 77 percent of private
institutions that accept credit cards charge convenience
based in Austin, Texas, conducted a survey in 2014 and
another one earlier this year which found the number of
colleges accepting credit cards fell 260 to 255.
However, the number of schools charging a convenience
fee went up from 142 in 2014 to 145 this year.
doesnít surprise me more schools are charging the fees
simply because they donít want to eat the cost of
those credit card transactions," said Matt Schulz,
senior industry analyst at CreditCards.com. "The
number of schools not accepting credit cards probably
stopped doing so because the population of students
using cards was not high enough to make it worth
said the majority of community colleges donít charge a
fee for credit card use because community college doesnít
cost nearly as much as a big university ó public or
lower the tuition cost the more likely someone is to
consider putting the cost on a credit card," he
said. "There is a big difference between putting
$1,500 on a credit card than $15,000."
student loan lender Sallie Mae released a report earlier
this year showing the percentage of parents using credit
cards to pay for college runs 2 percent to 3 percent.
However a higher percentage of students use credit cards
to pay college bills at 3 percent to 5 percent.
Woolsey, president and general manager of
CreditCardForum.com., based in Austin, Texas, said
retailers have always had to bear transaction fees for
credit card purchases and they pass it on to consumers
by increasing costs.
entities also accept credit cards like state and local
government," Woolsey said. "Even the federal
government allows taxpayers to use credit cards to pay
taxes, but they also charge the consumer a convenience
fee so they do not have to absorb that interchange fee.
of it is colleges protecting their bottom lines,"
he said. "They are trying to make a profit and they
donít want to accept less than 100 percent of the
tuition they are owed. My guess is people who use credit
cards to pay tuition already have the money in the bank,
but they want to earn rewards. This removes the
incentive to do so because the convenience fee is higher
than any rewards they earn.
credit cards are a terrible way to finance long-term
debt," Woolsey said. "Tuition is a long-term
debt and student loans are probably a better way to pay
for college in the long run."