I highly recommend using an outside service.  It makes the collection process more objective, which results in a higher collection rate.  You don't want every parent calling with an emotional story of why they can't pay their tuition that month.  Forcing electronic collection through an outside service is the way to go.  It is inexpensive to the parent, makes payment application and cash reconciliation very easy.  We use FACTS which has been excellent with great service, for many years.

You will still have a handful of parents who will not go through the service, but not that many and they will be more manageable.

L.