Student Credit Cards

You’ve seen them – giving away a free towel, t-shirt or whatever with your school logo on it. They’re on campus, so they must be ok. All you need to do is fill out a simple piece of paper to show your school spirit. The problem is, it’s all a scam, and your University is in on it, more than willing to make your life at college a financial hell.

Student debt is overwhelming enough, but what they’re hawking doesn’t come at student loan interest rates. These credit card companies usually have exclusive deals with your college or university to offer their services on campus, sometimes paying as much as $1,000,000 for that right. Now why would credit card companies pay $1,000,000 for the ability to give away free t-shirts to college students? Because, just like your mammy tried to tell you – nothing comes free.

Students are prime targets for credit card companies because they know you need things, and want things and are willing to pay. They also know that most students don’t have a lot of cash, and are always looking for ways to afford things like textbooks. So they fall all over themselves in an effort to extend credit at loan-shark type interest rates, tied to special promotions and other nonsense. Get ’em while they’re young.

There has been some Congressional scrutiny of the credit card industry in general, and now several states are beginning to address the marketing practices of credit card issuers on campus.

Most state laws do not prohibit the practice of marketing on campus altogether, instead they further regulate it. For instance, the California legislature just passed a law prohibiting the offering of free gifts for students on campus, and Texas requires schools that allow card issuers on campus to provide financial literacy courses as part of their freshman orientation. A Louisiana law does not allow solicitations during class registration.

An Oklahoma law prohibits colleges from selling student information for marketing purposes to credit card companies. Interestingly, the original Oklahoma law outlawed credit card marketing altogether on school property. However, the law was softened when officials from the University of Oklahoma said an exclusive marketing agreement with one card issuer had provided the school with $1 million.

This illustrates perfectly that Institutions of Higher Learning are actually businesses that are more interested in profit, than education.

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