Since the advent of electronic money, numerous organizations and institutions are choosing to set up an online payment system for the products and services they provide. Many universities and schools have already started to accept online payments. It is simply because of the convenience and effectiveness of the online payment system. At any time of the day, parents can pay through the online payment portal of the school thus reducing the effort of going to school on a regular basis. The funds are also available at disposal for the school within minutes of the actual transaction. Online payment systems are comfortable, fast and at the same time completely safe. There are several companies like My Payment Savvy, Payment Depot, SecurionPay, etc. that provide organizations with 24/7/365 online payment solutions. However, choosing an online payment system is not as simple as it might seem at first glance. There are several factors like fraud preventive measures, types of currencies the system accepts, security and reliability, cost of the service, etc. that schools should consider before selecting an online payment gateway. We have listed the top 5 mistakes that schools make, and how can they avoid them when selecting an online payment portal.
1. Cost of the service
The most sensitive part when choosing a third-party payment processor that offers us a payment gateway will probably be the price to pay for the service. Most of the schools get scared by the processing fee that online payment portal charge. Schools are charging tuition fee, lunch fee, or fee for library books, to recover the cost or raise additional funds for students activities. Losing some portion of that fee to set up another payment system can be a good reason to not choose it. There are several ways schools can handle the cost of the service. Schools can charge a small “convenience fee” to the parents for the online payment system. They can also add an incremental fee on ACH payments based on the size of the transaction.
2. Taking Security for Granted
Before selecting an online payment portal, schools should analyze if the payment gateway complies with the security protocols of the major credit card providers such as VISA (Visa Cardholder Information Security Program – CISP), MasterCard with its Site Data Protection (SDP) or Discover Information Security and Compliance (DISC). Although, schools are unlikely to be a target of hackers. However, there are students who like to push the limits of network and security protocols for fun and schools are common targets for such students. As such, schools should choose payment portals which has a good track record with schools and which understands its security concerns.
3. Payment Options
Schools should carefully look into the payment option provided by the payment portal they want to install. While some parents pay their kid’s fee quarterly or bimonthly, rather than monthly, there are parents who like to pay the fee in advance. Schools should confirm if their payment portal partner can provide access to payment options and types of payment according to the need. The types of currency (Dollars, Euro, Pound, etc.) your payment portal accepts also matters. Kids whose parents are living abroad might want to pay in a currency different than the country’s currency the school is operating in. Also, online payment portal option assumes that your clients have an internet bank account, as such providing a variety of payment options ensures convenience and credibility.
4. Losing Access to the Money
Bank accounts that are created within the network of banks to facilitate both debit and credit card transaction are Merchant accounts. If the school fee is processed by both debit and credit cards, it is done through merchant accounts. There are single and collective merchant accounts. In a collective merchant account, fees from several schools are collected in one account and is later distributed to individual school accounts. There is a high probability of delay and losing the track of money through such accounts. Schools should ensure with the online payment portal whether the account provided by them is a single or collective merchant account. It is better to choose a single merchant account since it saves time and the chances of losing track of money in such accounts are minimal.
5. Not understanding the degree of difference
Institutions like schools and universities always need funds. The availability of different payment options increases the accumulation of fund by providing convenient payment options. Even parents appreciate the payment procedure processed in real-time than waiting for paper checks. They also respond quickly to emails with the link to the payment portal. Online payment portals provide deeper support to schools finance handling system.
Most of the people do not carry cash these days. Businesses are also adding online payment system for the convenience of their customers and also for its benefits. However, choosing an online payment portal for your institutions is a huge decision and should not be taken immediately. A right payment portal can increase the accumulation of fund by reducing the amount of late or skipped payments.