College Students Face Consumer Debt

Many of the proposed bills would not only restrict the marketing tactics of credit-card issuers on campuses but would require colleges to educate students about using credit responsibly.

Many colleges not only permit on-campus marketing, maintains the Consumer Federation report, they benefit from it financially. Card companies sponsor student activities and pay rental fees in order to solicit on campus.

Students Want to Establish Credit

But not all students use their credit cards recklessly.

Just over half of the students applying for credit do so in order to establish their credit history early, reports the Institute for Higher Education Policy, a nonprofit, nonpartisan research organization.

“Most of our college students use their credit cards responsibly,” Discover Card spokeswoman Cathy Edwards says. “Students are much more aware than they used to be.”

Discover Card holds “tabling events,” where students receive free compact discs or T-shirts in exchange for applying for Discover Card membership. However, Discover maintains that their card members are aware and informed.

And Discover, along with many other leading credit companies, has responded to the growing concern over student access to credit by launching campaigns aimed at students and their parents.

The card issuer’s current television commercial — featuring a college freshman spending wildly using his parents’ credit card — seeks to create “a humorous depiction of a potentially serious situation,” Edwards says.

Discover and experts alike encourage parental involvement in a student’s decision to obtain a credit card and remind cardholders to read carefully all disclosures and documentation before completing a credit application.

For now, users continue to spread a word of caution on their own to fellow students. One 23-year-old user writes, “If I had just waited a year, I would have heard all the advice and warnings, and been a wiser spender.” — Mike Scott contributed video to this report.

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