Heartland Payment Systems Inc. is pushing a money-disbursement service it says can cut colleges' paper costs by electronically distributing financial aid payments to accounts tied to a student identification and general-purpose debit card.

Acceluraid addresses some of the compliance issues that have prevented schools from transferring financial aid payments to student ID cards, said Bill Norwood, the director and chief architect at Heartland's campus solutions division. Schools disburse the payments to federally insured accounts with Central National Bank in Enid, Okla. The accounts are linked to both a student ID that can be used to pay for laundry, books and other on-campus expenses and to a debit card that can be used at any merchant that accepts Discover, ensuring compliance with the Payment Card Industry data-security standard, the Federal Reserve's Regulation E and other requirements. Students can transfer money from the Acceluraid account to an external bank account or vice versa.

North Central Missouri College in Trenton, the first school to use Acceluraid, rolled out the program to its 1,700 students in January. Since then, it has disbursed just more than $2 million in financial aid to students, Norwood said. The program helps schools save money by eliminating paper checks and reducing problems that arise when checks are sent to the wrong address or student, he added.

But Philip Philliou, a New York payments industry consultant, said he had doubt that such a product could draw a wide audience. "I have not seen any research to suggest that students want their ID and financial card combined," Philliou said by e-mail. "In fact, having seen several failed attempts to marry a health insurance card with a prepaid card suggests otherwise."

Many school have allowed students load money onto their IDs, but use is often limited to on-campus merchants. Adding a debit card that runs on Discover Financial Services' network addresses that problem.

Heartland, of Princeton, N.J., requires participating schools to place a special automated teller machine on campus. Students can use the ATM to withdraw cash from the Acceluraid account.

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