Heartland Payment Systems Inc. is on the verge of opening up payment options for many college-campus concessions previously limited to cash or campus card acceptance.

The Princeton, N.J.-based company is rolling out new campus vending machine card readers that accept either a campus payment card or an open-loop credit, debit or prepaid card.

Simultaneously, the firm is testing a mobile-payment application called MyPay, in combination with several other new apps, designed for colleges that deploy its Campus OneCard payment system.

"It's a new twist for us to combine the legacy closed-loop vending operations with an open-loop option, and adding a mobile-payment application to that is a bit of a breakthrough, Ron Farmer, Heartland executive director of campus solutions and micropayments, tells PaymentsSource.

Deployed together, Heartland's newest campus-payment services could enable students to use a smartphone to check the availability and status of laundry machines, pay for a specific washer or a dryer with a mobile app, and opt to receive text messages notifying them when their clothes are clean or dry.

Because it is still in pilot mode, no campuses are yet using MyPay for laundry services, Farmer says. But several colleges, including Mt. Holyoke College in South Hadley, Mass., are testing the MyPay mobile application for purchasing various campus services including printing and copying, he says.

Other likely areas where colleges may use MyPay include bookstores, libraries, vending and laundry machines, and dining locations, Farmer says.

MyPay is designed for Apple Inc. iPhone and Google Inc. Android users, and colleges eventually will be able to configure the app for a variety of types of payments, he says.

"Most members of the young-adult population don't carry cash, so they don't accumulate quarters in their pockets to pay for laundry and printing," Farmer says. "But they have cards and smartphones, and we want to enable them to pay with whatever is in their pocket."

Apart from MyPay, Heartland for the past few years steadily has been expanding payment options for commercial laundry operations, including mainstream-market apartment complexes, which comprise two-thirds of Heartland's laundry-payments business.

Heartland in 2010 introduced the WaveRider Laundry System, which enables users to pay with debit or credit cards, in addition to coins, and to monitor machines' use online through a Web portal (see story).

This year, Heartland enhanced WaveRider for users with smartphones, Farmer says.

Heartland is not ready to introduce MyPay for mainstream users in apartment complexes yet, "but we know it's coming," Farmer says. "Mobile payment with Near Field Communication is obviously the next step down the road."

The field for expansion in laundry machines alone is huge, Farmer says. He estimates Heartland so far has added card-payment capabilities in some 600 commercial-laundry operations, comprising only 7,000 of some 5 million total commercial washers and dryers nationwide.

As mobile payments catch on at college campuses, Farmer expects colleges gradually to convert campus ID cards to virtual ones through handsets.

But such conversions will be slow because campuses typically are laden with costly proprietary systems based on a campus card.

"Campus systems are costly to change because every door and access point and dining hall has hardware and software that requires upgrading," Farmer says. "But there are also some efficiencies associated with opening things up to more versatile mobile applications with open-loop payments, which will eventually become the norm."

Mobile is obviously "the next progression" for campus card payments, Brian Riley, senior research director at TowerGroup, tells PaymentsSource.

"The whole world of college finance is changing,” he says “As students take on more debt and parents want more visibility into how students are spending funds, ... the opportunities for linking mobile applications to more account-management functions are very promising."

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