Statement: New CFPB report raises concerns about banking cards on U.S. campuses

WASHINGTON — The Consumer Financial Protection Bureau released on Thursday its 12th annual report to Congress on credit and debit cards marketed on college campuses. Some of the report’s key findings reference potential conflicts of interest and the financial harms those can cause for students. The CFPB news release notes that:

”The report raises questions about whether some marketing deals between colleges and financial institutions comply with Department of Education rules.The report also highlights a lack of transparency in the arrangements schools have made with financial institutions.” 

In conjunction with the release of this report, the Department of Education issued a reminder to schools on requirements for college-sponsored banking arrangements and committed to additional oversight of this issue.

In response, Ed Mierzwinski, Senior Director of U.S. PIRG’s Federal Consumer Program, released the following statement:

“We’ve studied campus banking relationships for decades. The findings of the latest CFPB report and the concurrent actions by the Department of Education are stark warnings that student consumers still face problematic practices that could hit them in the pocketbook. 

“The Education Department’s concurrent “Dear Colleague” reminder to colleges and universities warns that ‘We are aware of certain practices that may pose risks or excessive costs to students.’ We recommend that the Education Department investigate possible violations of its cash management regulations.

“Students and parents should know that their best deal may not be the bank account or card with the college logo or that the financial services provider promotes. Shop around.”