PayPal and Venmo expand into tuition payments with three new integrations

PayPal and Venmo are moving further into college tuition payments through integrations with Illumia, Nelnet Campus Commerce and TouchNet, letting students and families pay through their schools' existing online portals at participating U.S. universities. Bellarmine University, Butler University, Kansas State University, Michigan State University and Texas Tech University are among the first schools to adopt the option. The feature builds on PayPal's broader push into higher education, including recent efforts by PayPal and Venmo to handle revenue-share payments for NIL student athletes. The new payment choice is mainly a convenience feature, allowing users to fund tuition through payment methods linked to their PayPal or Venmo accounts while leaving tuition billing and campus payment operations with the established school platforms. Don Smith, Illumia's SVP & General Manager of Integrated Payments, said the integration is intended to expand payment choice without disrupting institutions' existing systems and processes. The rollout also raises cost and security considerations. Students and families may face transaction fees set by each school, and Bryan Dickson, education-policy director at the National Association of College and University Business Officers, said a 2.5 percent credit-card fee on a $25,000 tuition payment would equal $625, a cost that institutions may absorb or, where permitted, pass on to the payer. PayPal says balances held in PayPal or Venmo wallets are eligible for FDIC pass-through insurance through Goldman Sachs, Wells Fargo or Chase, but that coverage applies to the failure of a program bank rather than PayPal itself, which is not a bank and is not FDIC insured.

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