It is becoming more and more unlikely that college students will graduate with no college debt, and the fees keep piling up, especially for those earning a doctorate degree. Advisers who earned an online degree in finance may find themselves increasingly dealing with students buried in debt.
While most fees are directly related to education, a new report from the U.S. Public Interest Research Group Higher Education Fund reveals that many universities are pushing students to use payment cards and ATMs that carry heavy costs and fees.
“Campus debit cards are wolves in sheep’s clothing,” said Rich Williams, U.S. PIRG Higher Education advocate and report co-author. “Students think they can access their dollars freely, but instead their aid is being eaten up in fees.”
The report found that as many as 900 colleges are urging students to use the cards, sometimes even to get their financial aid money. More than 9 million people attend schools that have deals with financial companies, according to the report.
Colleges often say these cards provide an easier, quicker way for students to get money, but they carry high fees, insufficient consumer protections and few options. These cards carry fees for swipes, inactivity and overdrafts. The practice is quickly adding to U.S. student debt, which tops $1 trillion, according to the Consumer Financial Protection Bureau..
“The campus debit card marketplace is tilted so that students can’t get a fair deal,” said Ed Mierzwinski, report co-author and U.S. PIRG consumer program director. “Campus administrations and policy makers have the power to clean it up.”
Many students believe university-endorsed deals are safe, often because many banks require students to visit a website that is co-branded with the college. For instance, Huntington Bank paid $25 million to co-brand and link its accounts with Ohio State University student IDs. These relationships often result in the schools receiving payouts, revenue-sharing deals and reductions in administrative costs.