Feds should proceed with 'college card' rules

Stefanie Botelho's picture

Higher education is a priority for Sen. Tom Harkin. He has worked to make college pricing more transparent, increase aid for students and warn Americans about the troubling recruiting practices at some for-profit schools. Now he has joined other lawmakers in pressuring the U.S. Department of Education to address concerns about so-called "college cards."

College cards are checking accounts with ATM access and debit cards that are peddled to students on campuses in Iowa and around the nation. Banks set up booths at orientation and offer free gifts to students who open accounts that appear to be endorsed by the school. At some schools, the cards double as a college identification card.

Federal student loan money remaining after tuition and fees are paid can be deposited into these accounts, but students may be charged fees when they try to get that money. Earlier this year the Government Accountability Office reported that hundreds of colleges and universities contract with banks to offer students these banking products.

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