Campuses and Credit Cards
View PDF | Print View
by: barrywaters
Total views: 92
Word Count: 420
College campuses offer a lucrative venue for companies marketing credit cards. Walk on any campus and you will see representatives from various companies giving away shirts, mugs and applications for credit cards. Students are an easy sell. Most are experiencing the sense of being independent like never before in their lives. The idea of having credit cards in their name can seem like the ticket to financial freedom.
Banks have a tradition on many campuses. At a campus in Michigan, Bank of America has a relationship with the college that grants it the right to use student enrollment lists. The university gets a kick back for students who open credit cards with the company. Contracts like these often offer universities even more money, if their students carry balances on those credit cards. Although these contracts benefit both the university and the credit card company, they have the potential to exploit young people who many not know the consequences of poor spending decisions. As a result, many student groups are raising concerns about credit card issuers exploiting students. The relationship between banks and universities also came under a microscope when hearings were held on Capitol Hill last June to scrutinize campus marketing practices.
Banks that have contracts with universities contend that they are providing a valuable resource for students. When students have credit cards of their own, they are laying the building blocks for their credit report and learning how relationships with banks work. Banks offer seminars on responsible spending, budgeting and paying off balances on credit cards. Additionally, they say the credit cards offered to students have lower limits and more restrictions than those marketed to graduates. Students on many campuses can sometimes even choose between having debit cards or credit cards. Universities claim their relationships with banks violate no laws and bring in resources that are used for valuable programs and scholarships. Even so, many have taken steps to limit access to student information when they enter into new contracts with banks.
Like everyone else, students are feeling the affects of the economic downturn. Some may open credit cards to help with expenses. The presence of banks on campuses will remain a part of college life, but it appears that it will be a less exploitive presence than it has historically been. Students are likely taking notes during the current economic downturn and will research and understand how to be responsible credit card consumers.
About the Author
For more information on credit cards, goto www.getsmart.com/credit-cards.
Rating: Not yet rated