With widespread change happening anyway, now is the time to move closer to a cashless campus, experts say

In the early 2000s, when Maria Brown was the assistant director in the cashier’s office at North Carolina State University, her boss talked a lot about taking only electronic payments. No more cash or checks. She told him he was off his rocker. The concept seemed liked science fiction then. But he would bring it up from time to time; he just couldn’t let go of the idea.

Then in 2008, a peer at another university shared on a listserv that his institution had stopped taking in-person payments in the cashier’s office. Brown’s boss immediately asked what she thought, and she had to admit it didn’t sound so crazy anymore. Almost half of all payments were already being made electronically, and building on that could save money at a time when NC State was looking at budget cuts. She agreed that the idea made sense, and plans got under way.

Brown, who is now director of her office, shared this story in a recent webinar organized by Nelnet Campus Commerce, a higher education payment technology company that provides integrated payment solutions for more than 1,300 institutions across the country. Brown and David Glezerman, retired bursar at Temple University, talked about their insights into transitioning toward a cashless campus, and why now is the time for all institutions to begin or expand on their own efforts.

At North Carolina State, Brown said, making the transition proved especially difficult in a few areas. She added, “And then we had a pandemic.”

“This pandemic has changed the way all of us have to do business in 2020,” said Glezerman, who now assists higher education institutions with business process change. “But even without the pandemic, the need to move in a different direction has been there and will continue to be there. Most of us are still trying to do more with less. The pandemic has only expedited many of those concerns, and many of those changes. At the same time, it’s about meeting expectations. People have gotten used to doing things differently in the last six months, and it’s a matter of leveraging those opportunities going forward.”

No institution can accomplish the shift overnight. Even with the pandemic forcing change, the transition to cashless is a process that takes, at best, months to plan and longer to implement. Progress will be incremental, but the benefits are worth it. Here is Glezerman and Brown’s general advice for taking on the challenge.

Prepare your case

This is not a distinct step but a process that continues through and overlaps with the others listed here. It begins with gathering basic data about transactions going through the cashier’s office: the number of payments in each type, cash, paper check, etc.; where the payments are coming from and going to; the amounts. This information may provide clues as to people’s choices, or at least raise questions to pursue.

He also advises seeking input from auditors and getting guidance on the regulatory and statutory barriers, including state and local laws, that might limit or prevent refusing cash in certain scenarios. Some states and municipalities have passed laws to protect the unbanked, people who do not have bank accounts. A 2017 survey by the Federal Deposit Insurance Corporation found that 25 percent of families were unbanked or underbanked.

Glezerman recommends conducting focus groups with students and parents, to “see where the potential pitfalls are.” Student government representatives can be helpful in this as well. The goal is to be able to present options immediately upon informing constituents that change is coming.

“When students and other customers are confronted with change but given no answers or no direction, that’s when you raise the levels of frustration, anxiety, even hostility toward the institution,” Glezerman says. “By communicating up front, it helps you build a level environment where people don’t feel as though they’ve been left out of the process.”

Get support from the top

Whoever is leading the initiative should confirm that institution leadership is on board. “I don’t think that you need to have an edict from the top down,” Glezerman says. “But certainly, if leadership is in opposition or raises questions, you’re not going to get very much traction at the institution. In fact, you may get stymied in your efforts.”

Brown adds, “You don’t want that support to push. You don’t want to ruin relationships.” They’re critical in the next phase.

Start small; ask questions; offer solutions

One goal of the information-gathering process, Glezerman says, is to find “low-hanging fruit,” as he puts it, areas where the transition makes a lot of sense and would require little effort or investment. Smaller departments, for example, may not be adequately equipped to maintain the internal controls needed to safeguard cash. Brown cites the example of coaches at NC State, who used to give cash per diems to athletes for meals when traveling to away games. The institution now provides pre-paid cards.

Open a dialogue with the relevant people in these departments, ask questions about how, when, and why they accept or use cash, and listen. Brown says this is how she learned that the employees of the convenience stores in the dining halls spent as much as 75 percent of their time counting cash. That was reduced when NC State introduced an ID card-based payment system for employees and faculty. Book store managers were hesitant to stop accepting cash because there were many cash purchases on football game days. But analysis showed that card purchases on those days were typically higher, so there was an upside to making the change.

It’s about fully understating each constituency’s concerns and offering them better options.

In some cases, Brown adds, “horror stories” can help. She shared some examples in the webinar. Years ago, an employee in the cashier’s office had skimmed around $1,000 over an undetermined period of time. The loss was modest, but there were time-consuming follow-up audits for years afterward. In another case, a student made a $9,500 cash payment for tuition, and as the cashier counted it out, he insisted that he’d handed over $10,000. The office was forced to check the security cameras and search the employee—and it turned out the student was wrong.

“There’s so many reasons not to take the cash and so many positive outcomes when you don’t,” Brown says. “But it’s also really hard on a large university campus to wrap your arms around the many ways people take credit card payments. PCI-DSS (Payment Card Industry Data Security Standard) compliance is huge for all of us, and one little bake sale could open you up to all kinds of nonsense. I can’t stress enough the importance of giving people options that are easy and that are going to work.”

Glezerman acknowledges that some departments that receive a large number of checks, like an advancement office, may be understandably hesitant to stop accepting them. Can you get them the hardware they need to scan checks, rather than sending them to the cashier’s office? he asks. That’s at least a step in the right direction.

“Think in terms of an investment,” he says, “because while it may cost a little bit up front, look at what it can save you in terms of fees and staff time.”

Communicate early and often

At NC State, Brown and colleagues used every means at their disposal to inform people that changes were coming, including signs, the student newspaper, and various newsletters. Glezerman mentioned a large university he knew of that allotted a year for such efforts.

“The more people you can spread it out to the better,” Brown says. “Because if a student has a good relationship with their advisor, and they come to our office and have a bad experience, they’re going to go back to that advisor and say that we’re horrible people. But if the advisor can say, ‘I know about this, let me show you how easy it is to make a payment,’ that will help. As much as you can, just saturate your campus with information that you’re going to do this. And just be nice and charming when you do it so that you get their buy-in.”

Repeat

At NC State, the work continues. Many of the farmers who use the services of the veterinary school prefer to pay in cash. Football fans still bring cash for the concession stands. Kids from the area schools that visit for a day often have cash that their parents gave them for the dining hall. It’s a process.

Consumer payment habits and expectations were already changing before the pandemic, and institutions need to understand that those changes are accelerating and will be permanent. Higher education will not be exempt from these trends, nor should it want to be. The colleges and universities that can adapt will offer their students and other constituencies better service and reap the benefits of a more efficient and secure system.