You may want to reconsider how you allocate your funds if you’re a student who usually relies on receiving a Federal Student Aid loan refund because new restrictions on how you spend your money may soon be in place.

The U.S. Department of Education recently released a pre-solicitation notice stating that a trial program for a Federal Student Aid (FSA) Payment Card Pilot will run soon.

The program is titled the Next Generation Payment Card Program, or “Next Gen” for short.

According to the program notice, students would be given a federally granted card that would “restrict the types of products and services” that a student may spend their refund on. This card would be separate from any existing credit, debit or prepaid cards, but students may still use it for “purchases of everyday goods and services.”

This would be a major change in comparison to the current system that sends funds directly to colleges, who then disburse the proper reimbursements to their students in the form of a check or direct deposit. There are currently no restrictions on how students can spend that money.

The notice states that “the purpose of the FSA Payment Card Program Pilot is to test, with a select number of schools, an FSA Payment Card whereby federal student loan customers will have a consistent, economically advantageous and timely method to receive FSA loan refunds.”

According to the notice, students would have the opportunity to apply either online or in person at their university’s financial aid office during the trial run. Students would then open an account to obtain their card, and the participating schools would continue to disburse refunds through the “Next Gen” card.

The program would also include a new mobile feature wherein students can access a myStudentAid “Super-Portal” app that would reportedly include card controls, real-time transaction messaging, and direct connectivity to the six payment card authorization system.

The Federal Student Aid office has not yet announced when they plan to release the official solicitation for the program.

UNF is not participating in the trial run.

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