Few things are as exciting as the decision to pursue higher education. Evaluating programs, talking with admissions counselors, and perhaps even taking a tour across an ivy-covered campus. It is an investment in the future!
However, it is also one of the largest financial investments a growing number of students will make over their lifetimes. In the US, the average cost per year – tuition, fees, and room & board – is $16,188 for a public institution and $41,970 for a private one. Assuming 4 years to complete a bachelor’s degree and the total cost is $64,752 and $167,880 respectively. At these levels, it is not surprising that 80% of traditional undergraduates receive some sort of financial aid, totaling nearly $250 billion each year.
While state, federal, institutional, and other community financial aid programs have improved the accessibility of higher education, half of eligible students choose not to further their education for financial reasons and of those that do, but drop out, 47% cite similar reasons for not completing their degree.
The bottom line? Financial aid matters to student success.
Administering financial aid is incredibly complicated. The National Association of Student Financial Aid Administrators (NASFAA) estimates that the cost of compliance with US Federal regulations represents roughly $27bn annually and that 50% of institutions reported it as largest contributor to a resource shortage in their financial aid offices over the last year.
Failing to adhere to federal and state regulations has far-reaching implications, including becoming ineligible to participate in financial aid programs, which would be a catastrophic outcome for nearly all colleges and universities. Unfortunately, however, the high-stakes nature of compliance makes it difficult for counselors to shepherd students through the process as closely as they would prefer or to financial aid with academic advisement in meaningful ways. There simply isn’t enough time.
Given the critical importance of financial aid to student success, Oracle decided to make a major investment to bring bold, innovative, and complete capabilities to institutions in this area and to do it far earlier in the maturity of our Student Cloud solution. Financial aid matters, and thus mature capabilities shouldn’t be at the far, right corner of an SIS product roadmap.
Earlier this month we announced our acquisition of Vocado, which The Tambellini Group cited as a "game changer" for higher education. The authoring analyst, Mary Beth Cahill, wrote, “With Oracle accelerating its Student Cloud general availability timeline, those institutions looking to replace their legacy SIS will now have another viable choice in the near term…” Certainly, advancing the maturity of Student Cloud is a priority, but it is also about shifting the paradigm for financial aid solutions in important ways.
Vocado, which will be rebranded as Oracle Student Financial Planning, brings unprecedented automation, transparency, and configurability to the financial aid process. An institution currently using the solution achieved a 93% reduction in overall processing time per student, a 50% increase in responsible borrowing by students, and 24% financial aid-related improvement in student satisfaction. Vocado had a material impact on the ability of this institution to support students across the lifecycle more effectively and ultimately put a well-earned diploma in their hands.
While Vocado is a core component of our Student Cloud, institutions can also implement it as a stand-alone solution regardless of their current student information system. Oracle is deeply committed to delivering a practical path to the cloud, where institutions can choose when and how they migrate applications.
I hope that you will join us for a webinar on June 19, where we will discuss how institutions can leverage financial aid more effectively to drive student success and demo the Vocado solution. And if you are attending the upcoming NAFSAA Annual Conference, we are a Platinum Sponsor, so please check out our sessions and exhibit hall booth (#441) - we would love to see you!