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While the federal ban on withholding most college transcripts, which goes into effect on July 1, is welcome news for the millions of students with stranded credits, colleges and universities are anticipating financial repercussions, increased administrative workloads and potential effects on enrollment and retention.
That’s according to the newly released 2024 Transcript Regulation Impact Survey by the American Association of Collegiate Registrars and Admissions Officers and Ithaka S+R, which offers recommendations for how institutions can navigate the coming changes.
The report cites an estimate that some 6.5 million people have stranded credits, amounting to $15 billion in debt owed to colleges and universities.
Colleges have used transcript holds as a tool to incentivize students to settle their unpaid balances. However, research has shown that such practices disproportionately affect low-income students and students of color, and they contribute to inequities in higher education access and, in some cases, prevent people with stranded credits from getting certain jobs.
Numerous states, including California, New York and Ohio, banned transcript withholding in some cases prior to the federal rule change. Some institutions have already dropped their transcript-withholding policies, while others are in the process of doing so to adhere to the new federal regulations.
The new survey provides recommendations for alternative methods institutions can use to manage unpaid balances, including implementing payment plans, providing emergency grants, establishing debt-forgiveness programs and developing debt-avoidance initiatives.
