IN 1893, Charles Eliot, president of Harvard, introduced to the National Education Association a novel concept: the credit hour. Roughly equivalent to one hour of lecture time a week for a 12- to 14-week semester, it became the basic unit of a college education, and the standard measure for transferring work between institutions. To be accredited, universities have had to base curriculums on credit hours and years of study. The seat-time system — one based on the hours spent in the classroom — is further reinforced by Title IV student aid: to receive need-based Pell grants or federal loans, students have had to carry a certain load of credits each semester.

After more than a century, the system equating time with learning is being challenged from high quarters.

In March of this year, the Department of Education invited colleges to submit programs for consideration under Title IV aid that do not rely on seat time. In response, public, private and for-profit institutions alike have rushed out programs that are changing the college degree in fundamental ways; they are based not on time in a course but on tangible evidence of learning, a concept known as competency-based education.

The motivation for ditching time is money. This August, at Lackawanna College in Scranton, Pa., President Obama issued a call to improve college affordability that went beyond boilerplates about loans and Pell grants. He proposed a rating system that would attach federal higher education dollars to a college’s cost effectiveness and student performance. “Colleges have to work harder to prevent tuition from going up year after year,” the president said. “We’re going to encourage more colleges to innovate, try new things, do things that can provide a great education without breaking the bank.”

A new wave of innovators is following his injunction. College leaders say that by focusing on what people learn, not how or when they learn it, and by taking advantage of the latest technology, they can save students time and lower costs. There are 37 million Americans with some college but no degree, and political leaders at the local, state and national levels are heralding new competency-based programs as the best way to get them marketable diplomas.

The Lumina Foundation has been one of the champions of the approach. Jamie P. Merisotis, president and chief executive, says the rationale is not just lower cost but better education. “The time-centered system says if you take the coursework, get passing grades and meet our academic standards, you get the degree,” he said. “Competency is a student-centered, learning-outcome-based model. Where you get the education is secondary to what you know and are able to do.”

To help develop a blueprint for other universities, Lumina just announced a $1.2 million grant to support an evaluation of the University of Wisconsin’s competency-based program, set to begin in January.

But not everyone is so excited about the programs. Many are raising alarms that these untested offerings will limit or undermine the power of a university degree.

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CERTIFYING learning, rather than time, is not an entirely new concept. For decades there have been other ways to earn college credits besides sitting in the classroom. You can “test out” of certain courses through A.P., CLEP or D.S.S.T. exams. At many colleges, you can do an independent study and submit a research paper for course credit. Since the 1970s, Excelsior, Thomas Edison and Empire State have allowed students to earn credits through performance-based assessment, like a simulation with patients in a clinical setting, or by submitting a portfolio with evidence of previous learning, whether through workplace experience, military training or even a hobby.

But not until Western Governors University was founded by a consortium of 19 states in 1997 was an entire degree program structured around assessments of learning. The online institution introduced many ideas that have been copied by new competency programs. They charge fees per term, not per credit, with an “all you can eat” policy — take and retake as many assessments as you can fit into a six-month term.

Faculty members are divided into “course mentors,” who oversee student mastery of content, and “student mentors,” who coach and advise one on one. Students prepare at their own pace to complete exams, research papers or performance assessments. They can resubmit assignments until they get it. W.G.U., with 35,000 students, charges $5,800 a year. Typical time to degree is just under three years.

But W.G.U.’s program, though designed around competencies, still maps to a course and credit-hour system. New programs leave that standard behind.

College for America, an online arm of Southern New Hampshire University, was the first program to get permission from the federal government to award degrees based on tests, papers and projects rather than class time. That was in April; it started up in September with 500 enrolled. Programs have also been introduced by Capella University, which is for profit, and Northern Arizona University, a public institution based in Flagstaff that has partnered with Pearson for its venture.

Speed, along with less contact with teachers, is the major source of cost savings in these programs. Motivated students — they call them sprinters — can move through them extremely fast. By the same token, struggling students can study at a slower pace. (Of course, the longer it takes to finish, the higher the cost.)

Zach Sherman is a sprinter. A 21-year-old who spends his nights mopping up the ConAgra packaged food factory in Troy, Ohio, he joined College for America’s pilot program in the spring and is its first graduate. Mr. Sherman tore through the requirements for his associate degree in general studies in three months and five days. Each of the 120 competency goals he was given, which fell into clusters like “critical and creative thinking” and “digital fluency and information literacy,” had three to five assignments, like writing a marketing plan for a company or a short paper in response to the F. Scott Fitzgerald story “The Curious Case of Benjamin Button.”

“The last month, something clicked in my brain,” he said. “I just accelerated and did, I would have to guess, 30 to 35 hours of schoolwork a week on top of 48 to 56 hours of work. So it got super crazy. It would be: get off work, get a shower, get something to eat, schoolwork, sleep, repeat.” Mr. Sherman was hoping for a promotion that has not materialized. He’s thinking about getting his bachelor’s.

Perhaps the most watched competency-based experiment is being developed by the University of Wisconsin. “We have between 750,000 and a million people in Wisconsin who have some college but no degree,” almost 20 percent of the population, says the Wisconsin system’s president, Kevin P. Reilly. “According to surveys by our extension department, about 60,000 of them would go back to school right now if they didn’t have to quit their jobs, put their dog into a kennel and move into a dorm to do it.” The U.W. Flexible Option will be mostly online, with some in-person practicums. Students will be charged by three-month “subscription periods” and given access to mentors called “academic success coaches.” The first degrees will come from the Milwaukee and U.W. Colleges campuses.

To explain competency, Aaron Brower, who is leading the program as special assistant to Dr. Reilly, uses an example from one of the programs under development. As part of an associate degree in general studies, a student might be asked to write an essay about the 1920s in response to vintage photographs of the Cotton Club and the Ku Klux Klan. Beyond general knowledge of the era, he says, the exercise tests “the ability to write a story based on historical context” and “the use of source material in a research project.”

Mr. Merisotis of Lumina says that deconstructing curriculum into abstract, interrelated competencies like these is the way of the future for all programs, whether based on assessment or credit hour. “What you’re seeing is a growing recognition that all postsecondary credentials should have competencies that students can demonstrate as a result of their education,” he says.

Frederick M. Hurst, who directs Northern Arizona University’s new Personalized Learning Program, says that competency transcripts do a better job of communicating a graduate’s value to employers. “As an example,” he says, “if you look at someone’s transcript and it says they have three three-hour courses in history, an employer doesn’t know what that means other than someone knows about these time periods in history. If you break it down in a different way and talk about the writing skills that a student got out of those courses, that’s a skill someone will need in the workplace.”

Competency-based innovations, however, are getting some pushback.

“It’s scary for faculty,” Dr. Reilly says. “There’s a continuing sense that students can and do draw on so many sources of information that are now available at their fingertips. They don’t need to come to the monastery for four years and sit at the feet of the monks.”

“Now, I’m an old English professor who taught the Joyce course here at Madison two years ago,” he says. “The idea that you can’t understand Joyce unless you take it from Reilly three hours a week — that we faculty own the knowledge and anyone who’s going to be well educated has to get it from us — the world has changed so much that that’s no longer true.”

Markie Blumer teaches in the Human Development and Family Studies Department at the University of Wisconsin, Stout, which is reviewing ways that its online programs could fit with the Flexible Option. “I hear a lot of fear,” she confirms, ticking off concerns: What will happen to the bricks-and-mortar institution? Do students get the same quality of education? Will the Wisconsin system’s reputation be damaged?

An entire program built around assessments necessitates a high degree of confidence in their quality. But there are no widely adopted measurements of learning across higher education. Western Governors uses the Collegiate Learning Assessment, a test of critical thinking and related skills that is given to students at different colleges to provide a basis for comparison. But the newer programs rely entirely on assessments created in-house, and the quality will surely vary widely. For example, Mr. Sherman completed his College for America degree without writing anything longer than a1,500-word research paper; other “deliverables” included PowerPoint presentations, blog posts and “Internet Scavenger Hunt” results.

Another missing piece is classroom participation and debate. Contact with peers is hard to foster when every student is working at his or her own pace.

Amy E. Slaton, a professor of history at Drexel University, has been an outspoken critic of competency-based education. She sees it as a smokescreen for the class-based stratification of higher education.

“It’s a red flag to me, the idea that this is going to be more personalized, more flexible, more accountable to the consumer,” she says. “If you are from a lower socioeconomic status, you have this new option that appears to cost less than a traditional bachelor’s degree, but it’s not the same product. I see it as a really diminished higher education experience for less money, and yet disguised as this notion of greater access.”

Deborah Bushway, vice president of academic innovation at Capella University, says a too-narrow perception of competency-based learning could hurt its spread. Capella’s FlexPathbachelor’s and M.B.A. program was the second direct assessment degree to be given the go-ahead by the Department of Education.

“People are understanding competencies to be only skills, rather than an integration of knowledge, skills and abilities,” she says. “It worries me that we will dilute the impact of these models if we think about it this way.”

There is a perception that focusing on skills, rather than disciplines or ideas, and on outcomes, rather than on the experience of college, is a reductive, overly vocational way to approach what should be the lofty mission of higher learning. Dr. Bushway acknowledges that the word “competence” may be a branding mistake.

“Our learners tell us, ‘I don’t want to be competent, I want to be excellent,’ ” she says.

Regardless of these concerns, in an environment of growing tuition and student debt, low-cost competency-based programs are sure to find an audience. The programs now enroll only a few hundred students, but by this time next year, they aim to have tens of thousands.