The Role of Payment Plans in 2021 - Filling the Financial Gap

When it comes to enrollment and retention, your students’ grasp on financial literacy is extremely important. Students need to be educated on all funding options available, understanding that not all funding comes from one source. Being aware of multiple sources like federal grants or loans, work study programs, or scholarships gives students a more complete picture of how they can afford their education.

At the most recent NACUBO Financial Services Conference, the HigherEd Metrics® team and Nelnet Campus Commerce had the opportunity to chat with a group of student financial services professionals from small, medium, and large public and private institutions from across the United States. The group raised increasing concerns regarding financing options available for students in higher ed. When funding resources are scarce, it sends a rippling effect through enrollment and retention. Decreased funding can have a negative, direct impact on college students through:

• Inability to register for classes
• Missing core sequential courses
• Delayed graduation

The tough financial situations many parents faced in 2020, and are still experiencing in 2021, have made it more difficult for them to meet the credit qualifying requirements for PLUS loans as well as private, credit-based loans. According to Student Loan Hero, the pandemic and relief efforts from the federal government and student loan lenders have impacted student loans to the point that if you have adverse credit, your application for a parent PLUS loan could be denied. And adult students applying for credit-based loans are experiencing these same issues. Student Financial Services officers advise virtually all domestic students to first complete a FAFSA and apply for federal student aid. Yet for many, the gap between the cost of attendance and federal aid remains substantial.

Today’s reality is that families are having difficulty qualifying for the loans they rely on to fill in any tuition aid gaps—but there is still hope. With the reduction in credit approval percentages, students and their families have a financial lifeline in payment plans. Institutions that offer payment plans can replace the gap in funding, keeping students in classes, and maintaining their enrollment and retention goals—it’s a win-win.

Available at most institutions, Nelnet Campus Commerce offers three different types of flexible payment plans. Students can evaluate all of the payment plan options to find the plan that best suits their situation. For instance, the monthly payment plan allows students and families to pay the tuition amount due in manageable, monthly installments, and provides the convenience of enrolling and making payments online.

While it’s important for students to explore all funding options, offering payment plans can be the financial key to helping unlock their educational dreams.

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