USC is considering removing credit card from its tuition payment method list

If decided, the policy change will take effect next semester.

Update: USC announced on Jan. 5, 2019 that "beginning July 1, 2019, credit card payments for tuition, fees and other charges associated with student accounts will be limited to $10,000 per term."

In December 2018, Annenberg Media did send our audience feedback across our social media platforms to Donald Matthewson, the Treasurer of USC.


For one international student from China, using a credit card to pay more than $50,000 a year in USC tuition has its advantages. "I could earn more than $200 just by paying my tuition," said Bin Chen, a second-year graduate student at USC.

However, a proposed policy change on campus could mean students would no longer be able to pay tuition with a credit card as soon as next year. According to Donald Matthewson, the Treasurer of USC, that change could have an effect on how some international students pay for USC in 2018: annually, 73 percent of the international students and 53 percent of overall students pay tuition by credit card.

USC is considering the potential policy change to avoid covering expensive fees for students who pay by credit. Unlike many other academic institutions, USC pays the third-party convenience fee for credit cards instead of charging students for it. "We think there are about $11 million fees that USC is paying for them every year," Matthewson said.

The average level for credit card convenience fee is 2.62 percent, according to a survey of 300 U.S. largest universities conducted by in 2016. The survey also showed that in 2016, "only 15 schools take fee-free card payments today compared to 21 in 2014.""No decision has been made. The policy is under review," Matthewson said.

The method is still effective on USC Student Financial Service website to pay for Spring 2019. However, when Annenberg Media contacted the Cashier's Office, they confirmed the ban on credit cards policy, which is also on page 5 of an online Orientation Brochure. However, Matthewson said the brochure was not an official source.

While public universities in California can charge convenience fees, USC cannot. California state law prohibits retailers from imposing a surcharge on a purchaser who chooses to pay with a credit card. However, "retailer," as defined by the law, does not include public entities, including school districts.

"Public institutions can, like UCLA or Berkeley. But Stanford, Caltech and USC cannot charge it," Matthewson said, "Stanford doesn't take credit card. A majority of our peers and competitors in private space don't take credit card." Stanford University listed credit card as an option in 2009, but not for the years after.

At the University of California, Berkeley, the convenience fee is as high as 2.75 percent. Zeyuan Cao, a sophomore studying computer science at UC Berkeley, said paying with credit card costs the most among other options of payment. "Only a few students would have considered it," he said.

USC has made changes to the university's credit card policy in the past. In 2013, USC stopped taking American Express due to its high service charge comparing to others. Now the school is also looking at Visa, MasterCard and Discover.

Other payment options left for international students include debit card payments or wire transfers, which can take two to five business days. But none of them comes with cash reward or airline miles.

"Cashback is one reason," said Chen, "but moreover, credit card let students advance their tuition when they don't have enough money in the debit card."

He also believes most of the first-year international students do not have a local bank account when they first arrive. "So they depend on the credit card from their home countries," said Chen.

In addition, international students do not qualify for student loans, further narrowing their choice to pay.

For Mathewson, the conversation regarding credit card payment is ongoing.

"We've been looking at it for about a year," Matthewson said.

The decision will come out in a couple of months, and the new policy will take effect the next year if decided, Matthewson said. He wants to hear from students who have concerns. “We wanted to put the message out there. So if there’s an issue, we can get the issue on the table now,” he said.