CFPB Announces “Scorecard” For Campus Banking Products

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We support reforms to the financial marketplace that protect consumers from unscrupulous banks and lenders.

By Consumers Union on Wednesday, January 14th, 2015

In a new effort to protect students being marketed campus banking products, the CFPB announced today that it is developing a “Safe Student Account Scorecard” for schools.  The Scorecard will give schools a roadmap to negotiating a better deal for students when choosing a financial institution to offer bank accounts or prepaid cards on campus.

We’ve spoken out before on these school-bank partnerships, which can be problematic for students.  Some of these arrangements are designed to cut costs or even make money for the school, but turn out to be a bad deal for students.  Campus banking products can have high fees, or poor ATM access, and can be aggressively pushed onto students for receiving their financial aid.  Our recent report examined 16 campus banking products, and found that the costs can add up quickly for heavy users if there are fees for ATM use, point-of-sale transactions or overdrafts.

Under federal law, students don’t have to use these accounts – they can choose direct deposit to an existing account, or even check or cash, in order to get their financial aid.  But in practice, many students have been steered into campus banking products due to aggressive sales pitches and deceptive marketing materials.

The CFPB is taking public comments on the scorecard – if you want more information or want to submit a comment, go here.

One response to “CFPB Announces “Scorecard” For Campus Banking Products”

  1. I’m impressed, I must say. Seldom do I encounter a blog that’s both educative and amusing, and let me tell you, you have hit the nail on the head. The issue is an issue that too few men and women are speaking intelligently about. I’m very happy that I came across this during my search for something relating to this.

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