Society is moving closer and closer toward a “cashless” way of life. Higher education is not exempt from this shift, though as large institutions that are often bogged down by legacy systems, many are falling behind the times when it comes to catering to younger generations.
Millennials (those age 23 to 38 in 2019) and Gen Z (those born from 1997 onward) have new preferences for how to pay. Here’s how:
Mercator Advisory Group’s CustomerMonitor Survey Series Payments survey of June 2018 notes that almost all millennials own smartphones and 70% use mobile phones to pay for things.
Overall, Millennials are less likely than older generations to have checking accounts.
Gen Z loves mobile banking apps; 69% say they use them daily or weekly.
Sixty-eight percent of Gen Z consumers have interest in person-to-person (P2P) payments.
Dropping the Hammer on Digital Payments
Despite the clearly evolving payment preferences highlighted above, many higher education institutions are slow to adopt newer ways to pay. Given that most are operating on legacy systems, this makes sense. The prevailing school of thought is that maintaining status quo would be more financially prudent and less of a time-intensive undertaking. However, this inability to embrace change may cost higher education institutions in the long run.
Cash is a burden. It’s hard to manage and prone to human error and fraud. More importantly, fewer people carry cash, especially younger generations. Not upgrading payment systems or simply limiting the ways people can pay places an additional burden on students who want to make a purchase at the campus bookstore or grab a meal from an on-campus dining hall.
While it may be a stretch to expect universities to go totally cashless, and while many offer debit and credit card payment options, there is still work to be done. Leaning towards more debit or prepaid card payments is a step in the right direction, but mobile payments powered by near field communication (NFC) technology are the next frontier.
Making Mobility in Payments a Priority
The younger generations are digital natives. They were born with smartphone-in-hand and expect to enjoy instant gratification, especially when it comes to making purchases. Universities must find a way to bridge the gap between their current payments capabilities and what the younger generations of students have come to expect.
We’ve previously discussed the importance of mobility in payments, and this is still a key issue. Prepaid wristbands have grown in popularity for the festival-going crowd, but they also make a convincing case for the student lifestyle, too. Students could ostensibly pay for dining or campus-based sporting events by using this contactless technology.
European payments app Yoyo launched in 2014 with a trial that included a few dozen bars and cafes around the campus of Imperial College in London. The app enables users to easily pay using their smartphone while driving loyalty for participating brands.
Additional payment methods will continue to rollout and universities will need to consider how to fit new ways to pay into their current systems. While cash may not be entirely disappearing soon, increasing payments speed and convenience must be top-of-mind for higher education.
Your Partner in Payments Success
Whether your university is ready to move to a totally cashless campus or you’re just dipping your toes into new payments waters, we can help. Implementation is critical for higher education. We can help you ensure a smooth rollout by acting as an advisor, planning your roadmap to success, and streamlining integrations campus-wide.
We are experts in the higher education payment environment. We can help you quickly adapt your systems to meet the evolving higher education and payments landscape. We have relationships with key vendors to facilitate seamless integrations that keep your competitive edge fresh. Contact us today to learn how we can help you stay one step ahead and keep your students happy.