2008 Woodie Awards
Credit Card Bill Targets Exploitation of Students
Garineh Demirjian
Issue date: 10/31/07 Section: News
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The College Student Credit Protection Act (AB 262) that was signed Oct. 14 by Gov. Schwarzenegger will help shield college students from the luring promises such as gifts or low-interest rates from creditors.
The bill was written by Assemblymember Joe Coto, D-San Jose, and sponsored by the Greenling Institute, which is a multi-ethnic research organization whose goal is to increase low-income and minority participation in policy-making.
The bill will require colleges throughout California to disclose information pertaining to the school's marketing agreements with all financial institutions, with the exception of proprietary information. This means that if any faulty practices have already been put into place, proper procedures could help regulate their contents.
The bill also stops credit card companies from offering gifts as rewards for joining or using their services, which means no more fancy pens or company buttons.
As the number of students suffering from staggering credit card bills increases, so does the need to combat the problem.
According to Mark Maier, an economics instructor, credit card companies should be allowed on campus because "If we allow other private firms, probably we should allow them. Perhaps there could be a 'code of conduct' that credit card issuers would need to sign before being allowed to solicit business on campus."
The bill will urge universities to revise and re-think the ways in which they handle marketing on their campuses, which may significantly lower the number of debt-ridden students.
Since the bill passed with little opposition, banks have agreed to work with students and colleges in creating an agreement that will be beneficial to all parties.
According to the website of Nellie Mae, a student loan company, credit card companies are cruel predators: "They'll bait you with free T-shirts and music downloads and then attack your newfound hunger for independence as soon as you're in college and far from your parents."
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