For K-12 school business and finance administrators, managing fee collection efficiently is a crucial part of maintaining a district’s financial stability. However, many schools continue to rely on manual billing processes that, while familiar, hide significant added costs, increase the risk of errors, and slow down cash flow. Understanding these hidden costs and how to evaluate them is an essential step for districts to recognize the benefits of automating the fee collection process. This, in turn, will pave the way to modernize operations, improve service, and maximize resources.

Does your district still utilize manual billing processes? Consider these six questions to help you determine if it’s time to make the switch: 

1. What types of fees do K-12 schools Collect?

2. What does manual billing look like in practice?

3. What is the true cost of manual billing?

4. Is your district paying the “Manual Tax”? 

5. How does automation transform student fee collection?

6. Calculate your return on investment
   
   

What fees are K-12 schools collecting manually?

K-12 schools manage a wide variety of fees that can vary not only by district, but by individual school sites. One of the most common types are class fees which will vary depending on a student’s schedule. This could range from a simple technology fee (e.g. Chromebook), textbooks, or AP exam registration fees. Meal payments are also a common fee collected across nearly all school districts. Other fees may include before and aftercare registration fees, sports team and club registration, field trip costs, transportation fees, just to name a few. 

What Does Manual Student Fee Collection Look Like in Practice?

Commonly in schools, the manual fee collection process begins with pulling data from a Student Information System (SIS) or internal spreadsheets. Then, staff will often have to manually calculate any discounts and waivers that could apply to certain students. Next comes the labor-intensive task of creating the invoices themselves. Depending on each school’s method, these may need to be mailed out or emailed through a separate system.

The process of tracking who has paid and who hasn’t requires the ability to juggle several different tools and spreadsheets to ensure nothing is unaccounted for. When payments become late or overdue, staff must manually send out reminders on a case-by-case basis which could result in having to make phone calls, send out emails, or even mail printed reminder letters.

However, the process doesn’t stop there. Once the payment is made, whether by cash, check, or card, those transactions need to be posted and reconciled manually. Preparing audit trails and financial reports means having to pull together the proper data most likely from multiple different sources. Each of these steps consumes a significant amount of time and introduces opportunities for error, making the entire billing cycle inefficient and prone to significant delays.

What is The True Cost of Manual Billing?

While manual billing may seem like a straightforward and cost effective process, it can burden school staff with repetitive, cumbersome, and time consuming tasks. It’s important to consider other potentially less obvious costs too, such as the considerable time it takes to process each invoice and subsequent adjustments that often need to be made. Having to handle cash and checks can also incur overlooked labor costs, from the actual collection of the funds to bank deposit runs. Printing invoices, buying postage, check handling fees, and other banking costs can also quickly add up. On top of this, schools may be utilizing multiple different software tools that don’t integrate with one another, doubling efforts and creating the opportunity for mistakes to occur.

Indirect costs, while less tangible, are no less significant. Slow invoice processing and follow-up communication extend the time it takes to collect fees. This in turn can put added strain on district cash flow. When errors do occur, staff have to then spend their already limited time making corrections, issuing refunds, and resolving disputes. This endless cycle can often lead to staff burnout and cause frustration from impacted parents. 

There are risks that come alongside manual processes that districts can’t afford to ignore. For example, documentation gaps can increase audit exposure, resulting in penalties. Most importantly, maintaining sensitive data in spreadsheets and email attachments opens the door to privacy risks and potential breaches. As K-12 schools are already at such a high risk of data breaches and cyber attacks, this is an incredibly important aspect that should always be at the forefront of administrators minds.

Are You Paying the “Manual Tax”? 

As a school administrator, how can you tell if your district is paying the “manual tax”? If producing or adjusting a standard invoice consistently takes more than five minutes, that’s a strong indicator that your district is paying the “manual tax”. Also, consider if your district is having to scramble at the end of each year to track down unpaid fees, some of which you may never end up being able to collect. In this case, you’re missing out on revenue due to your current manual process.

Other signs include having multiple conflicting versions of billing data scattered across your SIS, spreadsheets, and accounting software. This can result in major confusion about what the “truth” really is, and how to know what data to trust. Frequent parent complaints about unclear bills will also shine a light on the inefficiencies and communication gaps that manual billing often causes.

How Does Automation Transform Student Fee Collection?

Automating fee collection with K-12 invoicing software can help your district avoid some of the direct and indirect costs associated with manual billing by streamlining inefficient processes, and reducing human-error. Additionally, it will support districts in creating a better experience for parents through improved accuracy and convenience.

In many cases, K-12 invoicing software can integrate with SIS systems. This integration can significantly speed up the invoicing process, especially when invoicing large groups. For example, if an entire AP Biology class requires students to pay an exam fee, or a soccer team needs to be charged for registration. The information stored within the SIS can be shared with the invoicing software, which can automatically send out invoices electronically by group/classes to make the process much more efficient. In turn, this eliminates the time-consuming task of manual data entry and tracking. 

Implementing software that supports ACH payments, credit and debit cards, offers autopay plans, and sends automated reminders provides families with easier access and helps ensure timely payments. With an automated system in place, it can lead to substantially lower overdue balances throughout the school year. 

Using fee and invoicing software can also simplify account adjustments with one-click refunds, partial payments, and payment plan management. On the backend, payments post automatically and can easily be reconciled with GL mapping, making for more accurate and faster reporting. It also provides the ability to export data right to your accounting system which can help to cut down on reconciliation time and ensure financial data is consistent across district systems.

Parent portals are another great feature that often comes with an automated software system. This online tool provides families with quick, real-time access to check a student’s balance, make and view payment history – all accessible right from their mobile devices. With this type of transparency, programs will often see a substantial reduction in billing inquiries and improved parent satisfaction.

How to calculate your Return on Investment

Deciding to automate fee collection is easier when you can see the direct benefits clearly. To do so, start by calculating both time and labor savings: 

• Subtract the expected automation time per invoice from your staff’s current manual time to completion. We’ve found that on average it takes staff five minutes to manually process one invoice. 
• Multiply by the number of invoices per year, and multiply again by the average hourly wage of your bookkeeper(s).

Lastly, factor in all those small day-to-day expenses that add up much quicker than you probably realize. Added costs can include printing, buying postage, and write-offs which will likely decrease when an automated system is put in place. 

Our own team has found that with the use of K-12 invoicing software, on average it takes customers just 14 days to receive full payment, and 95% of invoices are paid within 90 days of being received. A district that uses MySchoolBucks discovered that after implementing invoicing software, they were able to save their staff 47 days worth of work. That’s 47 extra days to repurpose staff labor hours for high value tasks that make a greater impact for students and parents.

Next Steps for Your Student Fee Collection

Manual billing can be far more costly and riskier than it appears to be on the surface. It strains staff resources, increases risk of errors, slows down cash flow, and frustrates families. By contrast, automated fee collection can transform billing into a predictable, efficient, and low-touch process that not only saves your district money and improves its financial health, but also enhances relationships between schools and its students and families. 

Whether a single school site or a district with many schools, a fee collection system will provide a number of benefits for everyone. Get a demo of our Student Invoicing solution to learn how it can automate your student fee collection process and support your staff.