WASHINGTON - (Legal Newsline) - Financial products marketed to college students will be examined by the Consumer Financial Protection Bureau to determine whether the offers are in the best interest of students.
The CFPB has requested financial institutions and the higher education community to provide feedback regarding their experiences with financial products such as what information schools share with the financial institutions, how financial products are marketed on campus, what fees are charged, how schools set up marketing agreements with the financial institute, and how students are using the products in their day-to-day lives.
"We have seen many colleges establish relationships with financial institutions to offer banking services to their students," CFPB Director Richard Cordray said. "The Bureau wants to find out whether students using college-endorsed banking products are getting a good deal."
Financial institutions became restricted from using certain types of marketing practices on college campuses in the Credit CARD Act of 2009. The CARD Act also made agreements between credit card issuers and colleges subject to public disclosure. However, according to the CFPB, less is known about arrangements regarding other products marketed to students.
To gain better understanding of the financial products offered to college students, on Thursday the CFPB published a Notice and Request for Information. Campus financial products include student identification cards that are also used as a debit card, cards used to access scholarships and student loans, and school-affiliated bank accounts.
The CFPB releases a guide for college students to learn how to choose a new credit card or checking account.
Due to a financial company facing a public settlement for allegedly targeting college students, the CFPB also released a consumer advisory to warn students about potential pitfalls.
The notice including information on how to electronically submit comments is located on the CFPB's website. Comments may be submitted until March 18.