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Bank Pays $34 Bounty For New College Customers

Thursday, September 5, 2013 - 10:38 AM
From GMA via Yahoo Finance:
Federal officials are increasingly concerned about the burgeoning number of deals between banks and American universities, saying colleges eager for new streams of income may be short changing their students. A study by the Public Interest Research Group last year found that there are now 900 card partnerships between colleges and banks – agreements that could impact more than 9 million students nationwide.

Members of Congress and the Consumer Financial Protection Bureau told ABC News they are now examining hundreds of these agreements. In many cases, students and parents were never told that banks paid millions of dollars in exchange for exclusive campus access.

... Documents obtained by ABC News surrounding the multi-million-dollar deal between the University of Minnesota and TCF Bank provide a glimpse of how expansive the agreements have become. The Minneapolis-based bank is paying the University of Minnesota more than $1 million a year to help it recruit students as customers, even offering the school bonus payments of $34 for every student that takes a TCF Bank account.

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The article points out that TCF Bank is not alone in this arrangement.  In 2009, Congress cracked down on deals between universities and credit card companies.   

But the takeaway message:  regardless of your age, if you don't have a basic understanding of basic financial topics, such as debt and credit, you will be fodder for those who have their own agenda.  Our children are being targeted because if you get them while they're young they are likely yours for life. 
pearlbrownpearlbrown1,440 posts since
Nov 2, 2010
Rep Points: 6,279
1. Thursday, September 5, 2013 - 1:10 PM
Just last week I advised my neighbor's daughter, who is going away to college for the first time, to stay away from the credit card sharks who will bombard her with various trinkets and offers to sign-up for their products. I just hope she can resist the tactics that those sales people who work on commission use. They are not her 'friends', no matter what they say.
ShorebreakShorebreak2,625 posts since
Apr 6, 2010
Rep Points: 14,226
2. Thursday, September 5, 2013 - 5:29 PM
In the past banks made deals with colleges and universities and then were allowed to set up booths or tables on campus to sell credit cards to students and the students were given T shirts, water bottles etc and the bank employees were paid $10 for each student signed up. Many could make $1000 on a good day. A DISGRACE. 
Ally6770Ally6770914 posts since
Jan 16, 2010
Rep Points: 2,662