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Higher One helps California college overcome long-standing barriers to direct deposit

A no-hassle student bank account allows Imperial Valley College to deliver fast, secure electronic refunds

Seeking an alternative to the slow and inefficient system of mailing financial aid and other refund checks to students, Imperial Valley College set up its own direct deposit system. The only problem was just one out of 10 students signed up.

“The challenge was getting the students to open a bank account, because they had to do it on their own,” says Carlos Fletes, director of fiscal services for the community college in the southernmost county of California. “They had to provide all kinds of information to the bank, and there was some resistance.”

"Students need their money now as opposed to tomorrow, and that's been very beneficial."

The college addressed the problem by switching to Higher One’s OneDisburse Refund Management System in October 2007, and now more than 90 percent of students receive a direct deposit to Higher One’s OneAccount or to an account at a bank of their choice. Only about 10 percent continue to receive paper checks.

“What we love about this system is that Higher One is able to open accounts with very minimal participation required from the student,” Fletes says. “It was so practical, and it made an incredible difference.”

In addition to being easy to open, the OneAccount is FDIC insured and has no monthly fee or minimum balance.

In adopting the Higher One system, the college sought first and foremost “to give aid to students in the most secure and expeditious way,” Fletes says. “Students need their money now as opposed to tomorrow, and that’s been very beneficial.”

Under the previous system, it took two to three weeks for students to receive refund checks after the amount of their financial aid had been set.

In addition to helping Fletes achieve his primary goal, the Higher One system also provided an opportunity for the college to achieve one of the student learning outcomes required under California’s standards for higher education. “For many students, this was their first introduction to a debit card and a bank account,” he explains. “This presented an opportunity to achieve one of our student learning outcomes by teaching students about personal finance.”

Imperial Valley College is just 12 miles from the border with Mexico, and 85 percent of its 8,680 students are Hispanic. For those reasons it was crucial to distribute materials that explained the Higher One program in Spanish as well as in English.

Higher One already offered a Spanish- language Web site and brochures that had been developed for clients in Texas and Florida. Fletes knew, however, that it was important to communicate with Imperial Valley students in the familiar “West Coast” Spanish, which has some different expressions. Fletes and his staff translated Higher One’s existing materials and created some of their own. “I can’t measure the success of that effort, but I know it helped a lot,” he says. “I’m sure those documents are now able to help other institutions on the West Coast.”

Instead of waiting two to three weeks for checks, 90 percent of students at Imperial Valley College now receive refunds quickly and securely by direct deposit. Students with One-Accounts have several options for accessing their money: writing checks, paying with a debit card, or getting cash from an ATM, a popular option.

This last option has been a boon for the local bank as well, which routinely faced an influx of thousands of students wanting to cash their checks on the same day. Now students can conveniently get their cash from either of two Higher One ATMs on campus.

“When we talk to other colleges in California, they all have the same experience,” Fletes says. “Students like to have cash.”