Western Union sees growth in tuition services
Updated: 2014-08-27 06:41
By AMY HE in New York(China Daily USA)
A Western Union location in Times Square, New York. The company has seen growth in the number of renminbi payments made by Chinese students paying for college in the US, where students from China make up the largest portion of the international student body. AMY HE / CHINA DAILY
Chinese students make up the largest portion of international students in US colleges and Western Union is seeing more and more of the overseas scholars use its services to get their tuitions paid from back home.
Since partnering with online and mobile payment company ChinaPay and China Citic Bank, Western Union has seen a 20 percent increase in the number of renminbi (RMB) transactions by Chinese students in the first half of 2014 over the same period last year, according to the company.
"As far as trends go, foreign students and the emphasis on foreign students have been very big in the last several years," said Jens Buckler, head of client management at Western Union Business Solutions, which handles cross-border payments. "I think universities are coming around to the idea that these students are very valuable to the overall experience that they give to the rest of their student body."
Colorado-based financial services company Western Union announced a partnership with ChinaPay at the end of 2012 to allow Chinese international students to make tuition and education-related payments more easily. It partnered with Beijing-based Citic Bank last June as the population of Chinese students studying overseas continued to grow.
"Chinese students are the No 1 population of foreign students attending US universities, so they're a very important group within an already growing group. Up until fairly recently, it was really difficult for them to make tuition payments," he said. "[Their acceptance] letters say, Congratulations, you've been accepted to this university you applied to, now here's a bill you have to go to your local bank and try to pay in a foreign currency, which can be an obstacle for those who only have access to smaller local banks."
Typically, Chinese students who have to make tuition payments to US colleges have to try to make an international transaction at their local bank, where the paperwork can be cumbersome and the currency exchange rates are not the most competitive, Buckler said.
"Individual students are going to walk up to the teller and say they need to pay $10,000, $20,000, $30,000. They're not going to get a really great rate. Individuals at the retail window, they don't have the buying power that a university would," he said.
The rate that would be offered by Western Union "is going to be the university's rate, rather than the individual's rate, so [the students] have a lot more buying power" and "they're going to achieve a lot more competitive exchange rate there", he added.
Local banks have to partner with large multinational banks for the transaction to go through, and payment details can get lost along the way, making it hard for schools to track payments back to particular students, Buckler explained. Multiple fees may often be charged as well, he added.
Western Union partnered with Citic Bank because the bank is popular within Guangdong province, where the company saw "a certain density in need", Buckler said, and students can go into a Citic Bank location and perform their transactions. For ChinaPay, students can pay their tuition online.
The company works with colleges across the US and is featured as a payment option among those offered to students when they're accepted, Buckler said.
"We're a 125-year-old public company and so when [students are] possibly making the largest transaction they've made yet in their lifetime, they can have a good feeling that the transaction is going to go through efficiently," he said.
"We're solving two issues here: one is with the student, who is on their own, making a large transaction, and the other is with the school, that benefits from foreign student attendance in a number of ways. We're trying to do right by both," he said.