Published: November 2007

Responsible College Credit Card Marketing

U.S. PIRG launches “Truth About Credit Campaign” to put a stop to the out-of-control marketing and unfair practices of the credit card industry.

According to U.S. PIRG, college students are graduating with too much credit card debt—close to $4,000 on average. The credit card industry vigorously markets to college students as valuable new customers on campus.

The "Truth About Credit" campaign aims to reduce student exposure to the worst practices that trap them into unfair terms and conditions. U.S. PIRG encourages campuses to adopt the following principles for responsible marketing.

The Principles of Responsible College Credit Card Marketing

1. Prohibit use of gifts in marketing on campus. Credit card banks, issuers, and vendors shall be prohibited from offering anything of value, including food, clothing, sports equipment, travel vouchers, coupons, or equivalents, for purposes of soliciting an application for a credit card on campus. In addition, issuers are prohibited from offering financial support or other goods and services to any campus employee or campus department in exchange for marketing privileges.
2. Control passive marketing techniques. Credit card banks, issuers and vendors shall be prohibited from leaving their marketing materials posted or displayed for longer than the posting regulations that govern the campus.
3. Block acquisition of student lists. Credit card banks, issuers and vendors shall be prohibited from purchasing lists of students of any kind currently enrolled at the campus.
4. Stop group sponsorship. Credit card banks, issuers and vendors are prohibited from negotiating deals with student groups and other campus departments such that the student group or department will receive financial support or any other goods and services for applications collected on behalf of a credit card company.
5. Increase financial education. Colleges and universities shall increase resources to support training and educational programs that increase students’ consumer awareness and ability to navigate issues of student debt responsibly.
6. Credit card contractual terms and conditions that take advantage of students as consumers shall be discouraged. Colleges and universities should discourage specific credit card terms that take advantage of the consumer. Such as:
   • universal default - where a company will increase a consumer’s interest rate based on her payment record on another account not associated with the card;
   • hidden fees - where a company does not disclose certain fees for paying by phone or ordering a copy of a bill;
   • mandatory arbitration - where the consumer gives up the right to legal action against the company;
   • changing contracts - where the company reserves the right to change all terms on the credit card at any time for any reason; and penalty interest rates above 20% that stay in place indefinitely.

For more information visit www.truthaboutcredit.org.

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