How Past-Due Payment Plans Are Saving Colleges Money and Supporting Student Re- Enrollment

A growing number of higher education institutions are facing a serious financial challenge: unpaid student balances. A 2024 survey conducted by ECSI and Higher Ed Dive found that 39% of colleges and universities manage past-due accounts totaling more than $1 million. Even more striking, 33% are dealing with balances that exceed $5 million. These numbers underscore the widespread impact of tuition debt on campuses across the country.

The Burden of Unpaid Tuition

Unpaid tuition and fees can place significant financial pressure on institutions. Traditional collection methods, such as working with third-party agencies, often come with high costs, require substantial administrative resources, and tend to deliver low recovery rates.

A More Effective Strategy: Past-Due Payment Plans

To address the problem more efficiently, many colleges and universities are shifting to Past-Due Payment Plans. These plans give students the ability to pay off outstanding balances in scheduled installments. This approach helps remove financial barriers that could otherwise prevent students from re-enrolling or graduating.

For schools, these plans create a valuable opportunity to recover revenue while avoiding the pitfalls of conventional collections.

Better Outcomes for Schools and Students

Institutions that have adopted structured repayment plans are reporting positive results. Many are seeing improvements in both revenue collection and student retention. When supported by features like automated payment reminders, integrated online systems, and real-time account tracking, these plans also reduce the administrative burden on staff.

Supporting Students While Securing Revenue

Past-Due Payment Plans offer more than just financial benefits. They allow institutions to stay focused on student success while also addressing budget shortfalls. By providing manageable and transparent repayment options, schools can support students in continuing their education and meeting their academic goals.

Interested in implementing a Past-Due Payment Plan at your institution?

Contact Herring Bank’s Campus Solutions team by filling out the form below to learn how these programs can be customized to align with your financial and enrollment strategies.