Meeting the rapidly changing payment preferences of international students

For many international students, the COVID-19 pandemic put their study plans on hold. Now that the world has returned to some sort of normality, international students are slowly but surely returning to universities across the world. In the UK, about 20% of the student population (605,130) are international – an increase of nearly 9% over the last year – and more and more are now choosing the UK as their preferred destination to study.

This surge in popularity has created a number of significant payment related challenges for UK universities, who now need to meet a range of different payment methods and preferences.  As part of regular research over the last several years, WPM, a Flywire company, has surveyed and held focus groups with thousands of international students studying in the UK to better understand their payment needs and challenges, as well to get a sense of how payment technology trends and developments are taking hold. More than 1,600 international students completed their 2021 survey.

The overall takeaway is that international students have very different payment needs depending on where they’re making payments from. But there’s a few themes that emerged that can help universities develop payment processes that fit the unique needs of their students – to help students spend more time focused on learning and less time worrying about paying for it.

Provide several types of payment options

Universities need to be able to accommodate several different payment methods, plus be able to shift quickly to accommodate changing payment preferences.

Prior to the pandemic, for example, students coming from China were much more likely to open a UK bank account to pay their tuition. Now, they’re much more likely to pay by credit card. In 2019, 88% of Chinese students surveyed had a UK bank account, a number that dropped to 66% in the most recent survey. On the flip side, only 25% used a locally issued Visa or Mastercard to pay their tuition in 2019 – a number that now sits at 46%. Chinese students are also more likely to pay before leaving home – and now have available options to do so.

Indian students, on the other hand, are much more likely than other nationalities to pay directly via a bank transfer – at a rate of 41% compared to 18%. Indian students are also significantly less likely to pay online using a locally issued credit or debit card, 14% v 31%. Nigerian students also prefer to pay by bank transfer. 

Communication and support around payment instructions is crucial

Just because students come from English-speaking countries, doesn’t necessarily mean the university can assume the payment experience translates in the same way. For instance, Canadian students expressed a high level of dissatisfaction with the payment experience, and are more likely to say that they hadn’t received any payment guidance from their university (36% v 13%), and that it wasn’t clear (33% v 16%).

Overall, while two-thirds of all students surveyed recall their university giving them guidance as to how to pay their fees in the first year, 21% also indicated that they felt that it was unclear as to how payments were to be made.

Offering payment plans is important

We introduced a new question into the survey last year asking whether the pandemic had influenced how or when students paid their fees, and this year we asked the same question of students in their second year at university and above. Nearly two-thirds of students said they changed the way they paid (either looking to pay later or earlier), changed how they paid, or were looking for different payment options. Some students and their families indicated that they had been impacted financially and needed the option of instalments to help them manage the cost. Others indicated that they were choosing instalments as a means of taking advantage of potentially more favourable exchange rates later in the academic year.

Payment security is very important

When asked what the most important thing for them is when making tuition fee payments, half of the students named security. There’s high concern over scams – particularly for students coming from China and countries in Africa, and university endorsement of the payment methods offered is still hugely important to many students. Students trust the university and want to pay in the way the university recommends. This also underscores the importance of payment processes that are fully integrated into university processes and where possible, uni branded. Students are more likely to resort to a direct bank transfer if their perception is that payment processes aren’t safe.

If UK universities take these steps, they will be able to address the significant concerns that international students have around paying tuition fees, making them feel welcome, part of the wider student community and ultimately enabling them to focus on their studies and enjoy all aspects of student life.