Debit cards advertised on college campuses or displaying a school logo often aren’t created in the best interest of students.
Companies pay colleges for the exclusive promotion of their bank and may even offer the college additional funds for each student account created. Arrangements such as these discourage busy college students from shopping around the market before making their decision on a bank. The arrangements between the banks and schools leaves room for negotiation between the two, yet often colleges are not utilizing this bargaining power to the benefit of their students. The Consumer Financial Protection Bureau has found college-sponsored debit cards lead to students paying excessive fees. These sponsored cards often do not waive annual fees, overdraft fees, and out-of-network ATM fees as other cards in the market do. Bureau research from 2014 found that almost 1 in 10 student accounts had at least 10 overdrafts per year, and an average of almost $200 in fees. While shopping for the best deal may be time-consuming, it could save you money in the long run.