Participating in the Hunting Challenge, besides striving for honor, there's also a chance to obtain significant material rewards.
For example, the blood, flesh, eyeballs, even the bones of demons, and so on, are all requisite materials for wizards to conduct magic experiments or cast certain spells, and are widely popular in the world of wizards.
Zheng Qing, in the Freshman Challenge, had collected a large batch of demon 'materials.' He's not required to hand all of them over to the school. After registering with the Hunting Committee, he only needs to pay a small management fee and he can keep most of them for himself. This also applies to the formal competition for the 'Academy Cup'. It means a great deal of gold beans.
This is also why the Hunting Challenge receives enthusiastic attention at the university, almost every student who has a bit of ability will attempt to become a hunter, joining a hunting team.