CREDIT CARDS ON CAMPUS: Current Trends and Informational Deficiencies
Summary
This paper was originally released at the National Press Club in
Washington, D.C. on June 8, 1999; the press conference was sponsored
by the Consumer Federation of America. Based on over three years
of primary research, the study features a unique set of comparative
data that includes more than 350 in-depth interviews (over 300 undergraduate
and over 50 graduate students) and more than 400 surveys among students
enrolled in Metropolitan Washington, D.C. universities.
The report examines the intensifying financial pressures on American
college students, decline in federal student grants, and the escalating
cost of higher education. The result has been that colleges have
encouraged students to increase their borrowing levels and they
have at unprecedented levels. Accordingly, credit card companies
have taken advantage of the needs/desires of college students and
consent of university administrators by aggressively marketing “plastic
money.”
The report critically analyzes the available studies of college
credit card trends. It concludes that the credit card industry systematically
understates total credit card debt among college students as well
as its social consequences--family conflicts, dropping out of school,
losing scholarships and financial aid, job rejections, bankruptcy,
and even suicide. It shows that the impact is especially severe
among students from low and moderate income families--especially
racial and ethnic minorities.
