Higher Education Spending: Speeding Up Fund Distribution
Even before the pandemic hit, higher education finance departments had a problem on their hands: inefficiency at a time of reduced funding.
The complex structures that make up a higher education institution bring with them hurdles in fund distribution.
Students are often concerned that money is being wasted, and universities were recently urged to provide students with detailed spend breakdowns.
A whopping 76 percent of students in England feel their university does not provide enough information on its spending – yet more than half of total expenditure (£21.1 billion across the UK) went directly on teaching and research activities for those students.
Add to this that the sector is facing a cash crunch due to reduced government funding and higher education finance teams are in for a rocky time.
And then there’s the pandemic. Financial controllers are seeking a way to speed up spend distribution in this era of fully-remote working.
It’s hard to distribute funds to individuals and departments
Think of the traditional way of getting funds out to the departments and teams that need it. You’re probably imagining corporate cards, maybe a locked petty cash tin in the faculty office. You’re imagining painful reimbursements and scraps of receipts. In the current remote climate, this is unfeasible.
The problem with petty cash
Not only do you need to be present in-person to access the petty cash box, but government pandemic safety regulations recommend we minimise our usage of cash. Lots of places are not accepting cash and teams (especially finance teams) are working remotely.
The problem with corporate credit cards
And it’s a bit tricky to pass the corporate card around when everyone is remote. Thinking of sending those card details by email? Don’t – think of the potential for cyber crime.
Then there’s the matter of spend visibility: it’s hard to see where funds are going if faculties use the same card or share a small number of cards With multiple people using one card, they can go over card limits unexpectedly; leaving you spending hours on the phone to the bank…
The problem with reimbursements
Distributing funds via petty cash and corporate credit cards present a third problem; reimbursements:
- In the current climate, employees are less likely to spend their own money to then be reimbursed later
- Some of the purchases that staff are making will be shifting. For example purchasing a new learning software isn’t unlikely to be something you would want on someone’s personal card.
The problem with traditional fund distribution in a pandemic
So much of traditional fund distribution in higher education institutions revolves around the fact you’re all together on campus and able to pop by someone’s desk. With students learning from home online, all barriers to quick and simple fund distribution need to be minimised.
Traditional fund distribution methods at this time are inefficient. In this remote climate, you’ll be clueless as to who spent what and why on a corporate credit card. Meaning more time than normal must be spent trawling through credit card statements. Not to mention the nightmare of getting receipts!
But there is a quicker way to distribute funds
There are better ways to distribute funds in this new remote world; enter virtual cards and digital receipt capture.
Virtual Cards and Digital Receipt Capture
Virtual cards work just like traditional prepaid business cards – but without the plastic. They’re managed online. You can allocate cards to employees and departments with set budgets so they can easily spend money remotely. Unlike corporate cards and petty cash, virtual prepaid cards remove the hassle of having to do reimbursements.
Using virtual cards enables finance departments to map spending according to how departments work. By not relying on physical debit or credit cards, funds are instantly deposited into dedicated sub-accounts for different faculties, functions, members of staff, or students.
With Soldo, there’s no limit on the number of virtual cards available – you could create one per individual, per faculty budget, or per campus, a way to manage individual, team and company budgets on the go.
Digital Receipt Capture
Say goodbye to paper receipts! With Soldo, once an employee makes a purchase, they can simply attach an image of the receipt and upload it to Soldo’s dashboard. The mobile app prompts staff to snap receipts at the point of purchase.
Additional benefits to virtual cards and digital receipt capture
- Sub-accounts mean cards can be allocated for specific spending (e.g one card for each department)
- Rules and controls over spend
- Real time spend visibility as soon as money is spent from an individual
- Ability to reconcile immediately instead of waiting until month end
- Information about spend against budget can be made available to heads of department far more easily
Technology helps empower financial controllers to take back control of fund distribution. Soldo not only helps to speed up fund distribution, but to also gain visibility into how that precious university funding is being spent across the board.
Learn more about tracking and managing higher education expenditure in our new ebook: Untangling Spend in Higher Education.