11 Sep 2012

College Student Debit Cards are a Banking Scheme

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Universities across the USA are getting ready to make millions of dollars in the near future as part of an alliance with banks. When students are given an ID card it also doubles up as a debit card which means that the student is encouraged to have financial dealings with whichever financial institution is contracted to their particular university. It’s thought that 32 out of the 50 largest US universities now carry this scheme.

 

This system has certainly not been put in place to help students, regardless of what the schools and banks are claiming. Banks and universities alike have been highly criticized for this, with consumer groups hammering home the point that it’s only the fat cats at the banks who are benefiting.

 

When students start at university they are away from home, probably for the first time. They are nervous and anxious about fitting in and getting the most out of the whole experience. Surely, bank and university leaders are playing on this vulnerability to ensure that they get more customers. It’s likely that some young people will just go along with this scheme because they have other things to think about and that’s a real shame because they could receive a much better deal with a different bank. Hundreds of financial institutions cater for a student’s needs by offering rates on loans, a student debit card and credit cards which are fair. By using the bank which is in partnership with their university, they could be setting themselves up for potential high fees on products such as overdrafts.

 

Opening a current or checking account needs to be considered carefully by any person, let alone a student. You must shop around to see whether these institutions provide services which will be beneficial to you. There are some great financial products out there which have been created specifically for students. Most people who attend university have little or no income so to manipulate them into taking out an account which may not work in their favor is scandalous. Unfortunately, these partnerships between banks and universities are well aware that young people need a debit card in order to live and so they target students as soon as they arrive on campus.

 

It’s been reported that many of these contracts put the universities under much pressure to promote the program which gives the students the impression that their school endorses a particular bank. It’s only natural that many students will be trusting of their university and will simply go with the flow without questioning anything. The fact is that young people deserve, and have the right, to make their own informed decision regarding who they want to bank with. The universities are displaying a very biased view of their campus card partner so that the banks will get more takers and in turn, they will make more money.

 

By shopping around, either face to face or online, students will find that there are some great deals out there which will help them and not the university. Accounts with features such as no monthly fee for having a debit card, free overdrafts, free internet banking and email alerts can help young people manage their finances more effectively. Features like these will actually save money for the student instead of costing them money.

 

It’s a pity that young ambitious people are not being rewarded by their universities rather than being manipulated for financial gain. These students are our future and it must cause them much anxiety to be starting their student life experience with the thought of potential debt. Its people’s lives and futures at stake here so it’s about time that these campus card partner schemes were discontinued, but given the huge amount of money involved, it seems unlikely.

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