Updated

Updated · Fox Business · Aug 19

5 Universities Start Accepting PayPal, Venmo for Tuition as More Schools Prepare to Join

Updated

Updated · Fox Business · Aug 19

5 Universities Start Accepting PayPal, Venmo for Tuition as More Schools Prepare to Join

Q: Will paying your tuition with Venmo actually cost you more in hidden fees than traditional methods?

Not necessarily, but it can if you fund the payment the wrong way or if your school treats Venmo like a card transaction. The key issue is not Venmo itself so much as the payment source behind it. If a tuition payment through Venmo or PayPal is funded by a bank account, balance, or ACH-style transfer, it is often free or cheaper than a credit card. But if you use a credit card in Venmo, Venmo generally charges about 3% for that funding method. On a $10,000 tuition bill, that is roughly $300. Many colleges already charge convenience fees for card-based tuition payments, often around 2.6% to 2.75%, while ACH or e-check is commonly free. The new PayPal/Venmo option may simply add another front-end choice inside the same campus billing system, not necessarily a cheaper one. Whether it costs more depends on the school’s setup and the funding method you choose. There are also other possible costs. If you move money instantly, extra transfer fees can apply. If a credit-card issuer codes the payment unusually, there could be cash-advance or other issuer fees, though that depends on the card and transaction type. The practical takeaway is simple: check the university payment page before using Venmo. Look for whether the school adds a service fee, whether bank-funded payments are free, and whether credit-card-funded payments trigger Venmo’s 3% charge. In many cases, traditional ACH or e-check will still be the cheapest option, while Venmo is mainly about convenience.

3 articles · Updated · Fox Business · Aug 19

Bellarmine, Butler, Kansas State, Michigan State and Texas Tech are among the first universities letting students and families pay tuition through PayPal and Venmo, with broader adoption expected later this year.
Illumia, Nelnet Campus Commerce and TouchNet are adding the options into existing campus payment systems, aiming to give families familiar digital-payment flexibility without forcing schools to rebuild back-end processes.
Transaction or processing fees may apply, and the cost can vary by university and by whether the payment draws from a balance, bank account or other funding method.
PayPal and Venmo say the tuition payments carry encryption and fraud monitoring, but regulators have warned that money held in nonbank payment apps may lack the same deposit-insurance protection as bank deposits.
Some eligible balances can receive pass-through FDIC coverage through PayPal program banks including Goldman Sachs, Wells Fargo and JPMorgan Chase, though PayPal says that protection covers a partner bank failure—not PayPal itself.