According to a report by the United States Public Interest Research Group (USPIRG) many banks are taking advantage of students who need campus debit cards to access their financial aid. They may appear to be an easy low-cost solution to handling finances while in school, but many of these cards carry excessive hidden fees.
“Campus debit cards are wolves in sheep’s clothing,” Rich Williams, one of the co-authors of the USPIRG report, said in a recent press release, “Students think they can access their dollars freely, but instead their aid is being eaten up in fees.”
Although campus debit cards are not required to access a student’s financial aid, many banks market their product directly on colleges’ financial aid websites, often creating the perception of being the only option.
Debit cards have received less federal oversight. And, according to a study, by the United States Public Interest Research Group Education Fund, an advocacy organization, nearly 900 colleges and universities have card relationships with banks or other financial institutions, some of which manage student aid disbursements by turning student IDs into debit cards. Some schools save money by outsourcing administrative costs. Others receive payments from the banks.