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CONTACT: Chris Lindstrom, 617-308-1063
U.S. PIRG Higher Education Program Director
The U.S. Public Interest Research Group applauds the Consumer Financial Protection Bureau (CFPB) release of a Safe Student Account Toolkit for campus administrators, released today after a several-year investigation into the unavoidable and unusual fees that students can be charged through campus bank accounts, particularly through the financial aid disbursement.
“For years, students have been hit with high fees in campus bank accounts – fees that aren’t found in the broader marketplace off campus,” noted Christine Lindstrom, higher education program director for the U.S. Public Interest Research Group, a consumer group with 75 college campus chapters across the country. “This toolkit will help campus administrators improve the quality of campus banking available to students, and I urge them to use it."
As PIRG noted in its landmark 2012 report, The Campus Debit Card Trap, two in five college students across the country are exposed to campus-sponsored bank accounts. The U.S. Department of Education recently set strict standards for bank accounts offered to students through the financial aid process on campus, including a ban on overdraft fees. However, the standard did not regulate fees on campus banking accounts acquired through other means, such as through the student ID office. The CFPB guide urges administrators to negotiate out overdrafts on all student bank accounts, regardless of how the student comes into contact with the account.
On a similar notes, in 2008, the consumer group released The Campus Credit Card Trap, which noted the widespread use of aggressive marketing on campus to entice college students into affinity credit card arrangements, in which the credit card is branded with the school’s logo. In 2009, a federal law banned the push marketing tactics that banks used on campus, and created reporting standards for campuses entering into these agreements. Today, the CFPB also released its biannual report on the state of the campus credit card marketplace, noting that many campuses are not compliant.
“Campus administrators must take their role in the campus financial marketplace seriously,” Lindstrom noted. “Otherwise, students will pay the price.”
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