Cards make paying global tuition easier
Updated: 2013-08-06 11:00
By Yu Wei in San Francisco (China Daily)
Li Mo, an incoming Chinese graduate student at UC-Riverside, is likely be offered the new option of paying tuition in RMB for the upcoming billing cycle through a new program between China UnionPay, a banking card association in China, and peerTransfer, a provider of global payment solutions for the education industry.
China UnionPay recently announced a new partnership with peerTransfer that allows Chinese students to pay their tuitions in their home currency online in more than 300 American universities, including BU, MIT and Cornell.
"I just heard about this great news," Li said. "It could make my life much easier if I could pay tuition and living expenses in Chinese currency online. I only hope that my university is on the list."
Li, a Beijing native who earned a master's degree at Kent State, learned the hard way how difficult paying global tuition can be.
"I used to use a local US bank to pay my tuition and because that bank was small, the money that my parents sent had to go through intermediary banks that took fees out before it finally arrived," Li explained, adding that the fees could be expensive.
The new partnership between peerTransfer and China UnionPay will enable students like Li to save time and money by offering them a local currency payment and a simple online experience.
Here's how it works: when a student China UnionPay card holder logs into peertransfer.com, they enter the name of the receivable school and the amount of money due in foreign currencies. All the fees are paid in RMB automatically with no conversion fee.
About 194,029 Chinese students were enrolled in US schools for the 2011-12 academic year, a 23 percent jump from the previous year and holding the spot as the top source of international students on US campuses for the third year in a row, according to the Open Doors report.
Shanghai-based UnionPay was established in 2002 as a bankcard association in China and has since forged partnerships with 400 financial institutions all over the world, expanding its global acceptance network along the way to 141 countries and regions outside China.
"As it grows internationally, China UnionPay is starting to want to have more international focus," said David Robertson, publisher of the Nilson Report.
Robertson said making it easier for people to pay online in their local currency "is part of a trend in payments that is also tied to the ability of someone in China to pay in local currency for goods from international merchants.
"This ability to pay colleague tuition in local currency is a little variation on that practice of allowing international commerce to occur in the buyer's local currency," Robertson explained.
However, he thinks there is still growth that needs to occur to make UnionPay a true competitor to Visa and Mastercard, given that the UnionPay card acceptance network is about one third size of Visa and MasterCard's networks.
"China UnionPay has a massive domestic card base and it has grown significantly, however, it is issued outside the Chinese mainland in only a handful markets, and Visa and MasterCard are issued in more than 200 countries and territories," Robertson said.
"UnionPay has only been in the business for 11 years. We have to give it time before it becomes a true competitor," he added.
(China Daily USA 08/06/2013 page2)