A new study reveals that nearly all U.
S. colleges are leveraging technology to manage budget pressures, with 49% accelerating tech investments, yet 44% identify implementation as their primary challenge. The Higher Ed Innovation Index 2025, conducted by Transact + CBORD, indicates that while 99% of schools use technology for cost reduction and most benefit from AI initiatives, payment modernization remains a work in progress.
The findings present a complex view of higher education’s digital transformation. Beyond implementation, which leads challenges at 44%, institutions cite infrastructure and facilities improvements (40%) and keeping pace with digital transformation (34%). Despite a widespread commitment to technology for budget management, many struggle to translate investments into tangible gains.
Laura Newell-McLaughlin, chief commercial officer at Transact + CBORD, noted, “Higher education leaders are making bold moves toward digital transformation, but the journey is far from simple. The data reveals that while colleges and universities recognize the critical need for modernization, many are being held back by operational silos that prevent end-to-end efficiency.”
Artificial intelligence is demonstrating measurable returns on campus. The study reports that 66% of schools indicate AI has helped reduce staff burnout, and 63% of leaders state AI is delivering cost savings. Furthermore, 84% agree they can access necessary data for critical decisions, and 74% possess the analytics to intervene when students face financial risk.
Student payment preferences are shifting, impacting campus financial operations. The research shows 96% of schools report increased student preference for ACH payments, 70% for direct bank transfers, and 62% for digital wallets. Digital wallets and pay-by-bank options are now eclipsing checks for tuition payments. Students frequently combine payment methods, with 67% of schools observing a rise in mixed payment methods, and 49% seeing increased mixed funding sources, such as scholarships, loans, and out-of-pocket payments.
However, this evolution introduces complications. Payment method fragmentation contributes to back-end operational challenges, with 44% of institutions reporting increased costs from managing multiple payment platforms. Additionally, 52% experience delays in receiving funds, 40% note increased administrative workload, and 37% cite more frequent errors and discrepancies.
Colleges are adapting to enrollment and affordability challenges. The study highlights that 29% of campus leaders believe cost pressures are limiting enrollment recovery. In response, institutions are expanding support: 40% of colleges report widened tuition gaps, 51% are increasing scholarship aid packages, and 76% indicate students increasingly use payment plans. Employer (63%) or third-party (27%) tuition payments are also growing.
Institutions demonstrate confidence in their cybersecurity preparedness, with 71% stating readiness for a major cyber incident. Nonetheless, emerging threats persist: 35% of campus leaders report rising fraudulent enrollments, while 37% indicate they are declining, showing a varied trend. Additionally, 28% of leaders report physical and digital security still operate in silos on their campus. Half of institutions (50%) are monitoring transactions in real-time to combat fraud, but 71% of campus leaders believe outdated security technology jeopardizes student safety.
The research indicates a sector in transition. While AI implementation progresses rapidly, institutions continue to contend with fragmented systems and conflicting priorities. Payment modernization, in particular, reflects a broader challenge: student preferences are evolving faster than back-end systems can adapt, creating operational friction even as schools work to enhance the student experience.
The Higher Ed Innovation Index 2025 was administered online by Hanover Research in July 2025. It surveyed 270 senior executives from two-year and four-year U.
S. institutions with decision-making authority over technology, digital strategy, or institutional transformation initiatives.
Transact Campus, a business unit of Roper Technologies, specializes in payment, campus ID, and commerce solutions for connected campuses. Its mobile-centric ecosystem simplifies the user experience across campus life, offering integrated solutions for tuition payments, multi-purpose campus IDs, and campus commerce.
CBORD, also a business unit of Roper Technologies, provides food and nutrition service management software, integrated security solutions, campus card and cashless systems, and commerce platforms for healthcare, senior living, higher education, and business campuses globally.
