Bill Baumann’s interest in Higher One Inc. first sparked when his son, a Western student, received the Higher One Choice Card in the mail before fall quarter began. Baumann researched Higher One to find out more about of the company’s policies and how this would affect his son’s financial aid.
“When I got online to look at how other universities used the card, and the impact it had on students, it was quite unpleasant,” Baumann said.
Higher One Choice Card fees are 50 cents every time one’s PIN is used, $2.50 every time the card is used in a non-Higher One ATM and an inactivity fee of $19 per month if the account is not used for more than nine months.
The switch to electronic refunding is a good move on the university’s part, because it decreases the amount of paper and eliminates human error, Baumann said — yet Western should not be jamming the Choice Card down kid’s throats.
“Unfortunately, the university did what I consider inadequate research when they selected Higher One as the vendor for this product,” Baumann said.
Baumann said he finds the cards irritating since students who receive financial aid could need every penny they are receiving to survive.
“And here [the university is] bringing in a product that makes its money on the very backs of these students,” he said. “It’s just ass-backwards. They’re doing the wrong thing.”
Baumann created an “Ignore the Higher One Debit Card Offer” Facebook page in order to inform students and have them get together. Baumann said he has not had much response to the page, but he hopes it will spread the word.
Brent Hunsberger, a personal financial columnist from The Oregonian, has researched Higher One’s contracts with Southern Oregon University and Portland State University for his online column, “It’s Only Money.”
“Giving out a debit card that charges 50 cents, unless it’s used as a credit card, is not a great way to teach college students about finances,” Hunsberger said.
Higher One began with Southern Oregon and Portland State along with a handful of other colleges about seven years ago, Hunsberger said.
“It seems like, each time, Higher One is able to convince the university administration that it can save the school money,” Hunsberger said. “Then, after the card is introduced, the students at the school get upset about the fees. It’s the same thing repeated at each university or each college.”
Baumann said the 24-hour turnaround Higher One guarantees with its direct deposit is a misguided come-on. He said his research on websites is not happening as quickly as Higher One says it will.
“What we need to work on for the future is persuade this university to eliminate their contract,” Baumann said.
Baumann made a public records request for Western’s contract with Higher One, but the documents may not be available until Oct. 9.
The number of default paper checks Higher One will be required to send out cannot be determined as of yet, said Paul Cocke, director of University Communcations. Checks are mailed out 21 days after funds are disbursed; students, however, have 18 days to request a direct deposit via electronic refund.
This is different from the 2010-11 school year, when Western mailed checks on the first day of class.
Higher One distributes all checks at no extra cost to the university, Cocke said. Western issued 14,600 checks last year. The annual net savings is more than $13,000.
Western has seen a variety of responses from students and their parents. According to Cocke, the response depends on the level of understanding that one person has of Higher One and the new refunding process.
“Those students with a clear understanding of the program, who researched their banking options and selected the refund method which fits them best, appear to be very satisfied or have not voiced an opinion,” Cocke said.
Investment firms are looking at the Higher One business model to see if it is sustainable based on students’ reactions to the fees, Hunsberger said.
“What a confusing financial lesson for college freshman,” Hunsberger said.
Southern Oregon and Portland State collaborated and created a pilot program with Higher One, eliminating the 50-cent PIN fee. Higher One would charge the institution a $2 fee per student each year that would be waived if Southern Oregon conducted an annual “swipe and sign” campaign, said Rick Weems, Southern Oregon University’s Assistant Vice President for Enrollment Management.
“I’m guessing they don’t make enough money to cover the costs they charge the universities for their services,” Hunsberger said.
These campaigns are designed to inform and encourage the students to swipe their Higher One card and sign for it, Weems said.
Cocke said Western is putting together a committee in order to organize a forum that could better decide a recommendation by the end of the quarter.
In the meantime, Baumann is still seeking a resolution to the current fees connected to the Choice Card.
“Bottom line: the university screwed up and they now need to make it right,” Baumann said.
