Universities Sell Out Their Students to Credit Card Companies

A recent study reported by CNN states that the average credit card balance of those students polled was $18,800.00. This is a staggering amount of debt for students just trying to start out.

How does this happen? Well just look to the universities who support these credit card companies and you will get the number.

Consider these annual revenues that colleges make off of arrangements with credit card companies:

University of Tennessee - $ 10 million a year with Chase
Ohio State – estimated $ 20 million a year through credit card arrangements

In turn for these big profits, “universities are pursuing these sweetheart deals with credit card companies, and offering up premiere marketing locations and student names and addresses for a big profit,” says Robert Manning, Director of the Center for Consumer Financial Services at the Rochester Institute of Technology.

Credit card companies want to sign up people. They in turn want to charge big fees for doing so. They want the college students to rack up big amounts of debt. In most cases, they give the student way more credit limit then the student can financially support. These cards come with huge fees and high interest rates. So, they came up with this ingenious idea.

Let’s pay college campuses millions of dollars to allow us to use the university name on the credit card and maybe a picture of the administration building or mascot. This gives the student the feeling that they are doing this through the school and that the school would take care of them. In order for the credit card companies to pay these huge kickbacks to the colleges, they charge enormous fees to the student. It is a typical credit card trap.

The universities who need the revenue stream put their students at risk by allowing the vultures onto the college campuses to look for prey.

The universities and credit card companies say that they are providing a win/win for the college student. It is more like a conflict of interest by universities and college alumni associations who often negotiate these deals selling their souls.