Online university trades student credits in high-debt era

University of the People strikes deals to allow its students to progress to leading institutions, but increasing proportion of recruits have dropped out elsewhere

July 22, 2018
Pawn shop
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Many emerging universities could only dream of establishing meaningful partnerships with institutions such as the University of California, Berkeley, New York University and the University of Edinburgh.

But for the nine-year-old University of the People (UoPeople), that dream has become a reality; in October, the free online institution launched a new student credit transfer agreement with Edinburgh, 18 months after striking a similar deal with UC Berkeley and several years after establishing one of its first collaborations with New York University.

Shai Reshef, founder and president of UoPeople – where tuition is free but students pay $100 (£77) for each exam that they sit – said that “universities in general would like to have diversity and we bring the kind of students who would never think” of applying to one of those prestigious names.

“It’s not my goal that every student who starts with us will graduate with us,” he said. “If our students can go to Oxford, they should go to Oxford. And if I can help them do so, I’ve done my job and I would be extremely happy.”

The new Edinburgh partnership allows refugees living in Scotland to start their higher education online with UoPeople and transfer to the Scottish university once they have achieved certain qualifications.

The collaborations with the US institutions are also based on a transfer agreement, where high-performing students who have studied at UoPeople are eligible to apply to NYU Abu Dhabi and UC Berkeley.

Mr Reshef said that he expects these types of partnerships to “continue and grow” as UoPeople becomes more recognised and tuition prices at traditional US universities continue to soar.

“When you look at some universities in the US, the price of higher education is just unbearable. I can see a situation where a university tells [potential applicants] – go spend a year or two at the University of the People, then come to study on campus with us,” he said.

But he admitted that the number of students who transfer will always be low due to tough admissions requirements; there are just “a couple of students at NYU and one student in Berkeley” who have so far transferred from UoPeople.

Much more common, however, is a “new phenomenon” of US students joining UoPeople after dropping out of traditional face-to-face universities as a result of huge student loan debts. A recent survey conducted by UoPeople found that 60 per cent of US citizens who started a degree but did not complete it would go back to university if they could afford it and fit it into their lifestyle.

Mr Reshef said that his institution recently responded to this demand by accepting credit transfer; the result is that about 2,000 of UoPeople’s 6,000 US-based students arrived with higher education debt from elsewhere.  

“It’s coming to the point where it’s a crisis in the US,” he said. “Some are dropping [out] and are either left with no option or find out about us and come to us. Others just don’t want to start in this game [of university].”

The last time that Mr Reshef spoke to Times Higher Education, in 2016, he predicted that other universities would emulate his model “when they see they have no other choice – when either they change or they have to close down”.

While he admitted that this has not yet happened, he pointed to a growing interest in free university tuition in the US as proof that models such as his are “starting to be more popular”.

“We started in 2009 talking about tuition free, then [Barack] Obama started talking about [it], then Bernie Sanders, Hillary Clinton, and already we see a few states are doing it,” he said. “So we are seeing this movement happening.”

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