Welcome to Higher Edvice, a forum designed to explore some of the most important issues facing higher education today. With in-depth commentary addressing the primary areas of student customer service, financial literacy and efficiency within the administration, we not only hope to provide valuable information to the higher education community, but we want your input as well! Higher Edvice was created by Higher One, Inc., a financial services company serving hundreds of colleges and universities, which means that we have extraordinary access to thousands of college and university administrators and millions of students throughout the U.S. By coming together to examine the questions and concerns we face in higher education, we hope that Higher Edvice will serve as a resource that helps your administration foster continued success.
By Christian Haggerty, guest blogger from Quinnipiac University
In the web based world in which we now live, internet fraud has become an unfortunate reality. This brand of criminal has become more prevalent in federal Financial Aid scams since 2005, due to change in legislation meant to adapt to increasing online studentship. Since this time, there have been 215 individual convictions from 42 different fraud rings that have been order to pay $7.5 million dollars in fines and restitutions.
These numbers represent a small percentage of the problem however, and authorities are having a hard time investigating the booming number of cases. A report prepared by The Department of Education’s Office of the Inspection General explains, “Because of the sheer volume of referrals, finite resources and other external limitations, we cannot investigate all of the referrals we receive concerning distance-education fraud rings.”
The Department of Education is encouraging individual colleges to take safety measures to avoid such cases. Precautions include identifying groups of students who live outside the school’s normal area of coverage, as well as withholding financial aid disbursements for a longer period of time to ensure student validity can decrease fraud opportunities.
Secretary of Education Arne Duncan has committed to work with Congress in order to, “…ensure we have all the tools we need to prevent criminal elements from defrauding federal student-aid dollars.”
The need for such security has increased in general, ranging from higher education institutions to companies and organizations. Opportunities in cyber-security employment are expected to increase through 2018.
Considering the overwhelmed state of the federal government in terms of investigating such cases, perhaps one of the ways to combat this breed of fraud is education. A large amount of awareness for cyber-security has already surfaced with the rise of the internet.
For example, University of Virginia, Quinnipiac University, Ithaca College, University of North Carolina, and Georgetown are just some of the schools and varying organizations involved with the National Cyber Security Awareness Month. This annual program runs every year in October and is sponsored by the National Cyber Security Alliance, and is designed to educate and promote awareness in the field of cyber-security.
Additionally, New York University Polytechnic Institute has sponsored their Annual Cyber Awareness Week for eight years. This includes a competition amongst students from numerous countries in varying fields of cyber-security. Schools such as Carnegie Mellon University, Columbia University, MIT, and Stanford University were represented this past year. These talented students took part in challenges that tested their knowledge of the subject and ability to be innovative.
Additionally, companies in the higher education industry, such as Higher One, sometimes work with authorities “behind the scenes” to assist in their investigations pertaining to fraud. Programs such as these combined with the efforts of government and individual institutions are crucial in deterring future escalations in online fraud and ensuring internet security.
By Christian Haggerty, guest blogger from Quinnipiac University
Each generation has characteristics that contribute to its identity as a whole. Generation Y, consisting of people born between the years of 1980-2000, is the largest collection of individuals since the baby boomers. 80 million strong, Generation Y has begun to influence the way business is done due to its unique spending habits and immersion in technology. Also referred to as Digital Natives, this group has kick-started an evolution towards mobile consumerism. Mobile transactions for this population are expected to reach $16 billion this year and it is anticipated that by 2015 consumers will spend approximately $119 billion on goods and services via mobile payment. Generation Y is a large contributor to these statistics as 9 out of 10 people within this demographic own a cell phone, while 20% make mobile purchases.
In consideration of the data, it isn’t surprising that industry leaders are attempting to develop services to cater to this consumer market. Google has launched Google Wallet, an innovative service that allows consumers to transform their cell phones into wallets through a mobile application for smart phones. This allows your credit card information to be stored securely on your cell phone and would replace the need for tangible plastic cards. Google is working with businesses to install an in-store system in which you can simply tap your cell phone onto an electronic reader to make a purchase. Google Wallet also hopes to improve the online shopping experience, and is already accepted by thousands of online merchants. Google Offers, which provides consumers with deals to local or online businesses, is another service of the application. This particular service appeals directly to Generation Y, in which 71% use mobile coupons to receive e-commerce discounts.
Both skeptics and believers have been chiming in on the potential success of the new technology. Concerns about the product include future competition, too many specific components, and poor marketing by Google. However, others believe that built-in security features, the appeal of the tap pay service, and the readiness of consumers under the age of 35 to be factors that will contribute to its success.
Success or failure of this specific product is yet to be determined, but attempting to meet the needs of consumers who continue to evolve with technology has just begun.
Building Efficiency and Effectiveness Within Your Team
The Effectiveness and Efficiency (E&E) team at Higher One continually shares simple hands-on improvement methodologies to enable constant growth and progress within the organization.
Rika Visser, Efficiency and Process Analyst at Higher One, shares more information about the E&E process at Higher One below:
Improving a process to benefit the way we work is dependent on each individual within a team, and it is important to know that everyone is empowered to be their most productive. Starting at our own desks, and in our work teams, eventually the entire company works together to speak the same language and work toward a shared goal.
The process we follow is based on LEAN principles and is known as 5S. It is simple, intuitive and easy to implement, and has set Higher One, as a whole, on course to becoming a company of better problem solvers. In a nutshell, 5S is a systematic way to identify and reduce waste, focus on value added versus non-value added work, and separate needed from un-needed items.
Since organizing our work environment according to these principles, Higher One has freed up capacity– mentally and physically– to streamline processes and work smarter!
Check out Mary Johnson’s, Higher One’s Financial Literacy and Consumer Advocacy Manager, newest article in the Huffington Post:
A college degree is and will continue to be a major key to economic security, social mobility and prosperity for millions of Americans. But as college costs continue to rise and family income remains stagnant at best, attaining that goal requires an increasingly significant investment of financial resources. Read Article Here.
Rising Costs of Tuition Prompt White House to Reduce Student Loan Debt for Low-Income Graduates
Among the list of things being actively protested by groups such as Occupy Wall Street are “crushing loan burdens” said Melody Barnes, director of the Domestic Policy Council. According to recent data compiled by The Project on Student Debt, students who graduated in 2010 carried 5% more debt than in the previous year. As college costs rise, the amount of student aid being borrowed has increasingly become a hot-button topic. Based on pressure, including more than 30,000 signatures on a petition on We the People at whitehouse.gov, President Obama has asserted his executive authority to affect change and alleviate some of the repayment burden currently being experienced by low-income graduates.
Currently most of the 450,000 low-income student-loan borrowers must pay 15% of their discretionary income for 25 years. For those who qualify—students who graduate next year with a mix of federal loans and loans under the Federal Family Loan Program— will be able to consolidate at a slightly lower interest rate. This “Pay as You Earn” program would allow graduates to pay 10% of their discretionary income for 20 years and have the rest of their student debt forgiven.
A popular misconception is that expensive private schools’ students carry the most student loan debt. However, as states’ budgets are cut, students at public schools are graduating with a higher level of average debt. Private schools, meanwhile, are funded by endowments, many of which are committed to providing grants to students they admit.
Education for both parents and students about where loan monies come from is instrumental in addressing the problem of student loan debt. Confusing terms in financial aid offers can lead to decisions whereby students choose to attend schools where they incur more debt .
At a press briefing on October 22, Secretary of Education, Arne Duncan, announced that borrowers making payments on both direct federal and loans made under the Federal Family Education Loan program can consolidate them and get a half-percent interest rate cut.
According to the College Board:
-Average in-state tuition at public universities has increased $8,244 (up from $7,613 last year). The average total charge (including room and board) is $17,131 compared with $16,162 last year.
-The average tuition at private nonprofit four-year colleges is $28,500 (up 4.5% from last year’s $27,265). Including room and board, the average total cost is $38,589 compared with $36,971 last year.
-Community colleges’ average tuition and fees are $2,963, an increase of 8.7% from last year’s $2,727.
Looking to streamline student services? This article from Campus Technology tells you 7 ways to help do just that! Check it out here.
We value all opportunities to listen, share, and collaborate together with you. Earlier this month, we held the Higher One Users Group conference (HUG) and the experience and time spent with clients was invaluable. At the conference, a few of you mentioned that it seems impossible not to notice the significant changes in the financial services industry. A lively discussion followed and some of you suggested you would appreciate more information on this topic and so I would like to share some thoughts.
Recently, the news media has been reporting on the rising costs of consumer banking, as the nation’s largest banks boldly and unapologetically raise fees on checking accounts and related services. While many of these banks point to recent regulatory changes as the cause of new fees, I believe this is an over-simplified explanation of much deeper change.
For many years-decades in fact, customers of traditional banks got used to the idea of “free checking.” While it was not costless for traditional banks to provide checking account services, most traditional banks were content to subsidize the checking account with revenues they earned from other services like credit cards and installment loans.
Over the last few years, changes in the economic and regulatory environments have limited the revenues traditional banks may earn on credit cards and other loan products. Yet, little has materially changed in the way these banks provide deposit services for consumers. Most notably, these same banks are saddled with massive branch networks and the associated cost structure.
The CEO of one of the largest banks in America noted publicly that his organization spends more than $300 per year to support each basic consumer checking account. And, in reaction to some of the regulatory changes, this same CEO was famously quoted in The New York Times saying, “If you’re a restaurant and you can’t charge for the soda, you’re going to charge more for the burger.”
Today, as we have for the last ten years, we’re taking a different approach at Higher One. We are enabling basic banking services in nontraditional ways for millions of college students. I can proudly say that since our founding, we have offered students a straightforward, no-nonsense banking experience. We power a full-featured optional checking account through our bank partner that millions of students find accessible, relevant and valuable; many students in fact use our services for free.
We can do this because, at Higher One, everyone is focused on efficiency. For us, it’s not enough that we have eliminated the costs of sprawling branch networks, massive marketing budgets and the bureaucracies of traditional banks. We’re always looking for new, less expensive ways to deliver quality services for you and your students.
Most importantly, through our bank partner, we continue to offer the OneAccount checking account with no monthly fee and no minimum balance requirement and we remain committed to offering the OneAccount as an option for any college student, regardless of credit or financial history.
We also know that students value transparency and choice and that they often have enough real-world experience to make smart decisions when given proper information. We have built our service around this reality with great success. The open communication surrounding our checking account’s fee schedule for optional services (anyone can access it in one click on several websites) can invite scrutiny. It even makes some uncomfortable, as people are not accustomed to financial institutions being so open on the subject of fees. Our goal is for our customers to understand the choices and make the one that’s best for them.
We are passionate about serving you with High Touch Service®. Our OneDisburse® Refund Management® funds disbursement service is cost-free for all students and is predicated on choice. For those students that choose the OneAccount, it’s a great option and we appreciate how important it is for us to continually offer a significant value for students.
Thank you for your continued support.
Dean Hatton
President & CEO
Higher One has recently launched the Money on My Mind video contest! The contest asks students to submit a two minute video about their money management challenges and their strategies of overcoming the struggle of juggling school, work, family and life in general.
10 videos will be featured on One For Your Money. Each featured winner will receive a cash prize, but the Grand Prize Winner will receive $2,000! Also, students who submit comments on the videos on One For Your Money will be entered for a chance to win prizes.
Want to promote the contest on your campus? Use this Money on My Mind Poster around campus!
For more information, visit HigherOne.com/MoneyOnMyMind
Mary Johnson is at it again! Read Mary’s newest student blog post on OneForYourMoney.com called “Student Loans: How Much is too Much?”
Student loans are an integral part of paying for college for many students, especially those attending private institutions. In 2008, for example, almost 60% of college students nationwide carried some level of student loan debt. Access to student loans, particularly low-interest federal student loans, has unlocked the door to a wealth of opportunity and empowerment for millions of students who otherwise would not have been able to afford college.
Mary Johnson, Higher One’s financial literacy expert, helps students manage their money by addressing their questions and helps colleges and universities strengthen their financial education initiatives.
Read Mary’s newest student blog post on OneForYourMoney.com called “5 Tips for Managing Your Bank Account”:
Too many money management problems while in college can be traced back to a student’s initial banking experiences. They often result from limited knowledge of how to use bank accounts and poor tracking of transactions. Students sometimes pay unnecessary fees for things like overdrafts and returned checks because they do not have a good handle on how much they spend or how much money is available in their account.
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