According to an article in the Denver Post Sunday, colleges, universities and alumni associations across Colorado make millions of dollars each year by making deals with credit card companies and banks.
These companies market and sell their products to students, staff and alumni and prey on the very people the university is supposed to educate and, to some level protect, making universities willing parties to financial predation.
Some of the ways that financial companies push their products on campuses include encouraging schools to sell mailing lists that provide thousands of prospective card holders, paying schools a percentage of every debit or credit card transaction, paying schools royalties based on the number of credit card or bank accounts opened, offering ATM or debit cards tied to student IDs â€“â€“Â think Colorado State University’s RamCard Plus â€“â€“Â with payments for each new account and bonuses when theyâ€™re used and marketing at all home athletic events.
All of these deals are attempts on the part of financial intuitions to get a new generation of customers running on the hamster-wheel of debt and Colorado universities are implicit in placing the crumbs that get students on the wheel.
Universities defend their actions by saying theyâ€™re helping students learn to be financial independent, but in reality these deals demonstrate how desperate universities are to make a buck â€“â€“ or a few million â€“â€“ amid budget cuts, at the expense of their students.
Financial institutions and credit card companies in particular are notorious for their willingness to rip off customers and bury them in debt. While it is studentsâ€™ responsibility to exercise due diligence in making financial decisions, many students simply are not educated or mature enough to make big financial decisions on their own.
By partnering with banks and credit card companies, universities are making a deal with the devil and making it easier and more appealing for students to get into the credit market instead of offering better opportunities for financial education and genuine learning experiences that would cost the university, not make it money.