Employer-Funded Financial Aid® (EFFA)

EFFAPay is Fundamentally Different from Third-Party Administrators (TPAs)
How EFFA Enhances Your Corporate Benefits Strategy

How does EFFAPay actually work compared to our current TPA model?

In the traditional model, TPAs sit between your company and universities, managing compliance, approvals, grades, and aggregating information to verify successful course completion.

EFFAPay replaces this middle layer with our procurement platform that:

  • Automates compliance through a specialized business rules engine
  • Receives grades and course information directly from universities
  • Applies your specific policy requirements automatically
  • Manages the secure flow of funds between your company and educational institutions
  • Eliminates third-party administrator fees (which can run up to 45% of tuition costs)

The result is a streamlined process where your company provides funding, EFFAPay provides compliance technology, and universities provide education—all without a traditional third-party administrator.

Could you walk us through how EFFAPay processes a typical employee tuition request?

Here's how a typical transaction works with EFFAPay:

  1. Policy Setup: Your tuition assistance policy is configured in our system once, including grade requirements, approved fees, annual caps, and eligibility rules.
  2. Pre-authorization: When your employee enrolls, the university submits details (course name, tuition amount, fees, etc.) to EFFAPay.
  3. Authorization Verification: EFFAPay automatically checks these details against your company's policy parameters and issues an approval code with the authorized amount.
  4. Education Delivery: The university provides education to your employee with payment deferred until completion.
  5. Grade/Completion Submission: After course completion, the university submits grades directly to EFFAPay.
  6. Policy Verification: EFFAPay automatically verifies that grades meet your company's requirements (e.g., C or better).
  7. Payment Processing: EFFAPay facilitates direct payment from your company to the university for approved amounts.
  8. Settlement: Funds are transferred to the university, and you receive a single monthly invoice for all approved transactions.

This approach eliminates reimbursement processing, receipt chasing, and manual compliance checking.

EFFAPay vs. Traditional TPAs
FeatureTraditional TPAs (Guild, EdAssist)EFFAPay
Primary FunctionAdministers tuition benefits and provides career servicesProcesses payments between employers and universities
Service CategoryEducation benefit administratorFinancial service provider/payment processor
Employee ExperienceEmployees pay upfront, then submit paperwork for reimbursementNo out-of-pocket payment required; documentation handled by university
Administrative BurdenHR reviews transcripts and receiptsAutomated through business rules engine
Policy EnforcementManual review by TPA staffAutomated through configurable business rules
Cost StructureAdministration fees (up to 45% of tuition costs)Transaction fee on processed payments (2.75-3.25%)
Fraud PreventionLimited, relies on employee-submitted documentationEnhanced, with documentation submitted directly by universities
Contract TypeEducation benefit administration agreementProcurement platform agreement
ControlLimited visibility and control over payment processDirect implementation of payment rules and policies
Key Benefits for Corporate Benefits Teams

How does EFFAPay reduce administrative costs?

EFFAPay dramatically reduces costs in several ways:

  • Eliminates TPA fees, which can be up to 45% of tuition costs
  • Removes reimbursement processing – no chasing grades or reconciling receipts
  • Scales without headcount – no need to grow internal admin teams as your program expands
  • Automates compliance – your policy rules are enforced on every transaction

You pay only for approved, completed educational outcomes—with full compliance built in.

How does EFFAPay improve the employee experience?

With EFFAPay, your employees benefit from:

  • No out-of-pocket payments required – increasing equity and access, especially for lower-income earners
  • No paperwork burden – schools submit all completion documentation directly
  • Faster turnaround – automated verification speeds up the process
  • Greater accessibility – employees who couldn't afford upfront costs can now participate

How does EFFAPay enhance compliance and fraud prevention?

EFFAPay enforces strict controls at every step:

  • Documentation is submitted directly by the school, not the employee
  • Payments are made only after validation of grades and policy compliance
  • All transaction records are timestamped, traceable, and auditable
  • Predefined business rules ensure consistent policy application

What systems does EFFAPay integrate with?

EFFAPay supports integration with:

  • Leading procurement platforms (e.g., SAP, Ariba, Oracle)
  • Internal HRIS or benefits systems
  • Existing third-party administrators (we can work behind the scenes to power them)

Integration is fast, secure, and scalable.

Implementation and Transition

What is required to get started with EFFAPay?

We onboard your company in three simple steps:

  1. Map your tuition assistance policy into EFFA's business rules engine
  2. Activate your organization's secure EFFA portal
  3. Notify employees and eligible learning providers

EFFA handles the rest—including onboarding providers, issuing pre-authorization statements, and managing payments.

How do we transition from our current TPA to EFFAPay?

The transition process is designed to be smooth and minimally disruptive:

  • Policy Mapping: We work with your team to translate your current tuition assistance policy into our business rules engine
  • Parallel Processing: We can run alongside your current system during a transition period to ensure continuity
  • Provider Onboarding: We handle communication and setup with your existing educational partners
  • Employee Communication: We provide customizable templates to announce the improved process to your employees

Most employers can implement EFFAPay within 1-2 weeks.

How do we measure the impact of switching to EFFAPay?

EFFA's platform provides comprehensive reporting tools that track key metrics, including:

  • Administrative time savings
  • Employee utilization rates compared to previous system
  • Processing error reduction
  • Cost savings vs. traditional TPA model
  • Time-to-payment improvements

Ready to take the next step?

For more information contact us at: EFFA Advisors