Fifteen tertiary institutions are facing potential sanctions after missing a government target for reducing the number of failed study visa applications by Indian students.
The 15 were among 40 institutions told to get their failure rate for applications to Immigration New Zealand's Mumbai office down to 50 percent for the first three months of this year.
Immigration set the target last year because of high decline rates and fraud in visa applications from India.
The Qualifications Authority said it and Immigration had asked the 15 providers to explain why they had not met the target.
"NZQA and INZ will consider the explanations and determine further action, as warranted. It is expected that this part of the process will be complete by mid-June."
The spokesperson for the Auckland International Education Group of private tertiary institutions, Paul Chalmers, said the agencies should be cautious.
He said some institutions were within the target until a spike in March.
"There's a problem with this. There's obviously some anomaly," he said.
Mr Chalmers said the agencies should wait for another month or two to see if the figures changed, because in many cases they involved a small number of applications and just a few refusals could put an institution over the target.
He said one problem behind the refusal rates was that it was getting harder to find good students because more Indian people were choosing to study in other countries.
"A lot of the students now are heading to other countries so we're at the back end of the student quality brigade so it's much harder for our agents to get the reasonable quality students," he said.
The Aspire2 group had two institutions meet the target but three that did not, with visa refusal rates ranging from 59 to 79 percent.
Its chief executive Clare Bradley said the private tertiary establishments (PTEs) had improved since last year, but there was a spike in their visa refusals in March.
"We've improved considerably and at the end of February we had only one of the PTEs that was just outside the 50 percent approval rate, so March was a nasty surprise," she said.
Ms Bradley said institutions offered students places based on the information that students and their agents presented to them.
"It must be that the agents are not necessarily ensuring that the applicants have ticked off all of the criteria," she said.
Ms Bradley said the company had told its agents in India to improve and many had been dropped, but it was a slow process.
"It takes time for everybody to communicate changes of policy, it takes time for the market to adjust. It's a bit like turning the Titanic," she said.
Manukau Institute of Technology had a 52 percent refusal rate last year, but got that down to 23 percent for the 151 applications made in the first three months of this year.
Its international director Stephen Johnson said it did that by writing to its agents in India just before Christmas.
"We indicated our expectations of them, that we were not at all happy with the low visa decline state that we had reached. We laid out a set of expectations indicating we would work with them wherever possible to see them improve these, but if they did not improve them then we would have to suspend business with them."
The assistant general manager of Immigration New Zealand Geoff Scott said there were a range of reasons some institutions had not reached the benchmark.
"Some of them are down to where they're recruiting from, so different areas in India have different pressures around that. The type of agents they use - if they're still using agents that are perpetrating fraud and helping the student to present fraudulent documents to us."
Geoff Scott said getting refusal rates below 50 percent was achievable and Immigration wanted to see institutions working proactively to reach the target.