The Buy-Now-Pay-Later trend is growing explosively, providing merchants with alternative financing options in an unsure economy – and its numbers are expected to continue to climb.
According to a Motley Fool study, 56% of millennials are using a buy-now-pay-later (BNPL) method for both online and instore shopping.
Over half of those surveyed who had not used a BNPL solution in the past expected to within the next year. Financial flexibility can be a huge boon when it comes to making large purchases, and credit cards with high interest rates are not the best option for everyone.
While many retailers are new to the BNPL market, educators have always had a need to allow students to pay over time for course costs. Starting a new career or learning a new skill can be expensive. And, offering a way for students to pay-over-time is crucial to both course providers to stay competitive and for students to be able to afford their education. But with today’s equally shifting educational landscape, course payment trends are shifting as well.
A National History of Paying for Education
In 1965 President Lyndon B. Johnson signed the Higher Education Act to make college more affordable. It also increased the number of government dollars allocated for federal loans, scholarships and more.
A school designated as Title IV is one that processes U.S. federal student aid. These schools can be public, private, nonprofit and proprietary, and are guided by the rules and criteria set by the Higher Education Act (HEA).
Things have changed a lot in the last half century. In today’s world, there are more and more stand alone course providers that don’t not fall under title IV requirements. Many prospective students refrain from taking courses that they are interested in, but are out of a feasible price range and don’t have the same student aid available as Title IV schools.
Luckily, there are alternative financing options that are becoming more readily available to this space. By providing a financing or payment plan option to students, educators can make their courses accessible to a wider audience immediately. The benefits include higher enrollment rates, greater student satisfaction, and the subsequent word of mouth.
Effective ways to pay for courses!
A personal loan is a sum of money that can be borrowed from a financial institution to be paid back over time, usually in monthly installments.There are many advantages to taking out a personal loan. The application and origination process is quick and all digital. These loans are unsecured and can be paid off early without penalty to help save on interest costs. The rates and terms vary based on the creditworthiness and financial history of the borrower. Personal loans are an excellent way to manage monthly payments and they can help to build a credit score when paid on time.
Payment plans are a great alternative to personal loans, especially to those with fair, poor, or even no credit. Using the right platform, educators will typically take a down payment and allow for the rest of the course to be paid off over a relatively short period of time, usually with a reasonable interest charge. They can be set up as direct deposit, making payments convenient for both educators and students.
The end game
Students and educators can benefit from financing tools. If an educator does not have the ability to direct students toward government aid, they can still offer aid via a personal loan to help enroll more students. Thinkific course-creators can include financing as a payment option right on their course pages.