Financial aid is critical for many students to make higher education accessible. It’s also vital for the financial sustainability of the many institutions that serve those students. But as essential as it is, many colleges are still using legacy systems with complex user interfaces and little or no workflow capabilities to guide students through the process, making many of the steps significantly more manual at a time when staff availability is substantially stressed. Since the COVID-19 pandemic, higher education has seen increased retirements and turnovers in staff throughout the institution.
As noted by the National Student Clearinghouse, student enrollment levels have declined by approximately 7.5 percent across all higher education levels since 2019. Many potential students are questioning the value of an academic degree compared to the cost. A 2021 Lumina-Gallup State of Higher Education survey noted that approximately one-third of students pursuing bachelor’s or associate’s degrees have considered withdrawing due to program costs. However, the same study indicated that more than 70 percent of students consider withdrawing due to the emotional stress of juggling work, coursework, and financial commitments. Females and students from low-income families were more likely to indicate they experienced frequent emotional stress.
Today’s students are digital natives with high expectations regarding their digital practices, and they expect consumer-like experiences. And today’s modern financial aid solutions can provide a much more intuitive and simplified view of a student’s financial commitments and awards than legacy solutions. A portal typically shows a complete picture of a student’s financial condition. Financial information is available on a single screen, with the ability to drill down and gain better insights into specific charges and awards in a few clicks. The student portal provides a one-stop resource for all financial aid activities, including uploading and managing documents and accepting or declining offers online. It can also provide one-click access to a financial aid counselor.
Additionally, most modern financial aid solutions are mobile ready, providing transparency for students and counselors regarding requirements and business processes. The ability for students to access and update their financial aid information in real time via multiple devices, including mobile, and through a modern interface contributes positively to student recruitment and retention.
Modern financial aid solutions also typically have rule-based workflows that can provide up to 85 percent process automation. This functionality can directly address the staffing shortages many financial aid offices are experiencing today. It also potentially frees financial aid advisors to meet directly with students who require higher levels of assistance.
Further, selecting a modern financial aid solution doesn’t necessarily require the replacement of an entire student information system. Today, we see colleges selecting financial aid solutions separate from their student information systems. These standalone solutions have gained market share and often provide functionality unavailable in legacy student system financial aid solutions. Previously, these third-party solutions may have been selected by schools using institutional methodology (IM) in determining a student’s proposed aid package. However, more modern UIs and enhanced functionality such as portals, analytics, and rule-based workflows are likely reasons these solutions are gaining traction with institutions.
Several new financial aid solutions have recently emerged, joining others that have been available for decades. Depending on an institution’s plans for the modernization of legacy systems, selecting an updated financial aid solution may align with its future goals for a modernized student system. But it doesn’t require or lock the institution into a particular student selection since integrations with most higher education solutions are readily available. It may provide a critical first step toward modernization while addressing a vital function that we all agree needs as much simplification as possible!
Modern financial aid solutions can be transformational for both students and employees. They also can provide an opportunity to analyze and examine an institution’s current financial aid business processes and reimagine and reengineer the process while significantly simplifying the experience for the students who are often the most dependent on financial assistance. But Tambellini research shows that, although some institutions have selected these updated solutions, some have not taken the opportunity to reengineer their processes and have failed to grasp these systems’ value. Modern solutions can clearly demonstrate the financial impacts of changing programs or dropping a course, allowing students to act in real time. Further, several solutions now offer advanced analytics that can flag academic struggles that may correlate with financial situations, allowing for proactive approaches to retaining students. In times of enrollment declines, retention has become a more critical business imperative.
Staff turnover and retirements have placed additional stress on institutional resources, including financial aid. Student engagement and retention are now critical for most institutions. Additionally, federal regulations are becoming more complex. The price for noncompliance can be steep, ranging from fines to repayment of funds to loss of eligibility to participate in federal programs. A modern solution can provide transformational change for institutions and students. Modern user interfaces and financial portals do much more than jazz up the look and feel. Rather, they provide students and their families with financial insights and the ability to take action to ensure their academic goals are not interrupted due to unforeseen financial issues.
Rule-based automated workflows minimize delays in financial aid awarding, significantly reducing the burden on staff who would otherwise spend substantial time manually ensuring that processes are executed correctly. These gains can give financial aid staff more time to engage with parents and students proactively in meaningful ways. Perhaps it’s time to take a look?