How Universities Can Combat Effects of Unpaid Tuition

Picture this: your institution’s tuition payment deadline for last semester was six months ago, but several students are past due on their accounts. After several unsuccessful attempts to help them reconcile, you’re forced to send them to a collection agency. You wish there were a way to avoid the negative impacts this will have on their credit. You’re also worried these students will have to unenroll from their classes (if they haven’t already). This will negatively affect their future and your institution’s bottom line.

Many students face the challenge of unpaid balances, a situation that can jeopardize their enrollment status and academic progress. You can help rewrite this story by providing students with past due payment plan options—like those offered by Nelnet Campus Commerce—to manage overdue tuition while staying enrolled.

When students fall behind on payments, they experience significant financial stress in the near and long term. This is exacerbated even more when missed payments result in a student being sent to a collection agency. This can have negative consequences such as damaging credit scores and increasing fee payments.

Past due payment plans allow institutions to offer students a way to pay down their past-due balances before they become delinquent, keeping them out of collections and avoiding long-term credit impacts.

When students have unpaid tuition, they often can’t graduate, remain enrolled in current classes, register for future classes, or access their transcripts until the balances are paid. For many students, paying a large, lump-sum bill isn’t feasible—especially when a collection agency adds extra fees. This can prevent students from ever completing their education, significantly limiting future career opportunities.

With past due payment plans, institutions can offer students the opportunity to continue their education while paying down their balances in smaller, more manageable installments.

According to the National Center for Education Statistics, undergraduate enrollment in higher education has decreased by about 10.7% from 2010 to 2024. Many factors play into a declining enrollment rate. Among these factors is students having to unenroll due to unpaid balances.

Past due payment plans allow students to pay overdue balances while remaining enrolled, increasing your institution’s retention rates. Offering flexible payment options is also a useful admissions strategy, enhancing an institution’s reputation and attracting new students.

Past due payment plans can decrease collection agency fees incurred by an institution while helping you receive payments from students, faster. This increased cash flow provides institutions with needed financial resources to plan better and invest more in staff, facilities, and other important areas. This is particularly critical for institutions that rely heavily on tuition revenue to fund their operations.

When students fall behind on tuition payments, it often requires substantial administrative time and resources to follow up with each student individually, negotiate payment arrangements, and manage the collections process. With past due payment plans, your business office can avoid chasing down students for missed payments, freeing up valuable time and resources to focus on other important tasks. Not to mention, eliminating the need for outside collection agencies can further reduce administrative work and expenses.

Providing options to pay down overdue tuition balances benefits students and institutions. Using effective software for your payment plans makes this process efficient for your staff and user-friendly for students. When you choose Nelnet Campus Commerce for your Past Due Payment Plans, expect these key features.

1. Offer students flexible payment schedule options.
2. Allow students to pay via ACH, auto-debit, and credit cards.
3. Proactively set notifications to prevent students from falling behind.
4. Customize repayment schedules by term or semester—whatever works for your bottom line.
5. Access robust reporting features with detailed tracking of payment statuses for transparency.

Implementing new products can be challenging, especially if it impacts policies and procedures for staff and students. A dedicated Nelnet project team will work with you to determine the best options for your past due plans based on your institution’s policies. We’ll create a project plan that suits your timelines and ensures you are comfortable with the product settings and functionality.

When you choose Nelnet Campus Commerce for your past due payment plans, you get more than just a vendor—you get a partner in your institution’s success. We know managing receivables is difficult and time-consuming. We’re here to help make it easier for you by providing full-service customer support for your staff, students, and families. With Nelnet, you’ll have a dedicated support system ready to assist with setting up plan options and schedules, managing agreements, and taking student payments over the phone.

Want to learn more about how Nelnet Past Due Payment Plans can support your institution and students? Talk to our team of experts today.