...Credit Card Company Solicitations of College Students Rapheal L Smith COM/172 Version 1 April 20, 2011 Dr. Paul A. Jessen Abstract Credit card companies are in business to make money. It is obvious these companies are not helpful to today’s consumers whether young or old, because consumers are now accumulating debt as early as high school and college. Why not target the young consumers? This is a time when most young people put every dime they have toward their education, which leaves them feeling broke. Some credit card companies even go as far as visiting the colleges, lined up in the student union centers, ready to pounce on the inexperienced; often times offering students free hats, t-shirts, inexpensive MP3 players and other freebies if they sign up for a credit card. The young, unsuspecting college student thinks, "Hey, I can charge up to $1000 and have a monthly payment of only $10!" Due to the inexperienced thought process of the student, he or she has no idea that paying the minimum amount means higher interest. They are oblivious to the fine print indicating the high interest rates, finance charges and late fees that are waiting to swallow their good credit once they are unable to maintain the monthly payments. They don't know that not paying at all means that they will have no credit-worthiness. No credit- worthiness means that they will eventually have bad credit and little to no chance of opening a new line of credit, financing a vehicle or becoming a “hassle...
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...What young college student does not need a little extra money for the weekends? What would a person think if they were told they could make some extra cash in just a couple of hours? Now you are talked into meeting on your college campus with a credit agent from Citibank and wind up selling thirty cards to fellow students. Now this might all sound perfectly innocent, but this is a very real incident that happened to a University of Pittsburgh student named Ryan Rhodes three years ago. Of those thirty students that signed up for credit cards, no one knows how many of those students are managing the cards they received or the resultant debt that comes along with that. Ryan has done 13,000 dollars worth of damage to his credit and was and maybe still is having a difficult time paying off the debt. He would not be the only one in that situation. Students across the country are filling out applications for credit cards on their campuses, and after the damage is done to their credit, just exactly what the cards are for, and what credit debt means. Students are not being told of the dangers of credit cards consequently, young adults are being caught unawares and thrown head first into the credit trap. Credit cards are damaging to uninitiated students and should not be pedaled anywhere on college campuses. High card payments are one of the first things an unsuspecting student has to contend with. The uninitiated spend with reckless abandon, driving up the monthly payment. When this...
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...Even though credit cards can be a source of paying for college-related expenses; credit card companies should not be on college campuses because most students will misuse the credit card, go into credit card debt and not realize the full financial hole they are in and struggle for years to pay off the debt. The first reason why credit card companies should not be on colleges marketing to college students is that it is very easy for a college student to misuse the new credit card. A college student most likely has limited financial means and a credit card could help today but hurt substantially more down the road. With a limited income, it would be very easy for the student to become financially dependent on the card. A 2009 Survey by Sallie Mae concluded the following. “The economic downturn has most Americans tightening their spending habits, but not all. College students are even more dependent upon credit cards, according to a survey conducted by Sallie Mae, the nation’s leading provider of student loans. The organization released its survey results last week in its National Study of Usage Rates and Trends. The study focused on undergraduate student’s ages 18 to 24 who were enrolled in public and private four-year colleges and universities during the spring of 2008.” [ (Phan, 2009) ] Another misuse of credit card spending occurs when the student is trying to fit into a social crowd among its peers. Many students feel a need to be part of socially acceptable “cool” crowd...
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...I. Credit card companies should not be on campus marketing to college students College kids and credit cards have been news lately, following a June 1999 report by the Consumer Federation of America (CFA) that blasted card issuers for luring unsuspecting students into debts. Sociologist Robert Manning, the author of the CFA study, was quoted in a Reuter’s story as saying: “The unrestricted marketing of credit cards on college campuses is so aggressive that it now poses a greater threat than alcohol or sexually transmitted diseases.” Most news stories took cues from Manning and touted the risks of credit cards on cash for students. By National On-Campus Reports, 6/15/2005, Vol. 33 Issue 12, p 34-35. II. Credit card companies target college students into applying. The now commons practice of card companies’ offering students credit cards is being portrayed as a way to lure students into an addiction to pilling on debt they can’t handle. Banks have become more aggressive and creative on luring college students to apply for credit credit cards. College students have been targets to banks for years because he or she does not have any financial obligations. Most of the nation's major credit card issuers are aggressively marketing unsecured credit to students (in their own name) through advertising, direct mail promotions and on-cam-pus recruitment, with giveaways like compact disks, mugs, candy bars, calculators, sunglasses, credit card-sponsored concerts, discounts on airfares...
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... Introduction Credit Card debt and college student debt are problems that must be addressed now. We are seeing to many people suffer from both since they are misinformed and not educated about either. I got my first credit card when I was 18 years old. My parents taught me to be careful with my card and if I wasn’t they would cut me off immediately. Unfortunately people are now getting credit cards earlier and parents are not teaching kids how to use credit cards correctly. According to a study, “50.9% of students had debt before college” (Jones 2005). This means over half of the people entering college already are in some type of debt. Students must be educated before college so we can alleviate the amount of students in debt. Graduating students are “leaving college with $20,402 in education and credit debt” (Robb and Sharpe 2009). This results in people trying to dig themselves out of debt for their whole life. The average student also has “4.25 cards in their name” (Davidson, 2004). This is part of the reason why students are accumulating so much debt since they don’t know how to properly manage credit cards. This is because students have a low degree of financial literacy. This means that students don’t know the true value of money and as a result spend more than they have. We can see this by the amount students are using their credit cards. Not only are students getting in debt, but it is also having social impacts. The social impacts are students ruining their relationships...
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...Eliminating Student Debt Bonnie Heath COM/156 August 29, 2010 Lori Wilson Eliminating Student Debt What I hope to accomplish in this paper is to show the reader that because of the predatory practices and shady deals with the different schools, credit card companies should not be allowed on campuses marketing to college students. The level of debt in society today is high enough and credit card companies do not need to be targeting college students just to increase their number of customers. Even though they should be allowed to market to college students because it is a good way to learn about credit cards and how to handle them responsibly, credit card companies should not be allowed on campuses to market to college students. College students already have enough debt as it is if they do not receive scholarships or help from their parents, and college students, fresh out of high school, do not know enough about personal finance and personal credit to be responsible about credit cards. I happen to agree with this statement because when one thinks about it, college students who do not have scholarships or help from their parents are already in enough debt as it is. One argument for credit card companies being allowed to market to college students is credit cards are a way for students on their own for the first time to establish a good credit score, which then can be used later in life to obtain loans for cars or homes. Credit card companies market to college students in the...
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...Young Consumers Credit card use: disposable income and employment status Joshua Fogel Mayer Schneider Article information: To cite this document: Joshua Fogel Mayer Schneider, (2011),"Credit card use: disposable income and employment status", Young Consumers, Vol. 12 Iss 1 pp. 5 - 14 Permanent link to this document: http://dx.doi.org/10.1108/17473611111114740 Downloaded on: 26 November 2015, At: 00:30 (PT) References: this document contains references to 29 other documents. To copy this document: permissions@emeraldinsight.com The fulltext of this document has been downloaded 2151 times since 2011* Users who downloaded this article also downloaded: Downloaded by Universiti Selangor At 00:30 26 November 2015 (PT) Arpita Khare, Anshuman Khare, Shveta Singh, (2012),"Factors affecting credit card use in India", Asia Pacific Journal of Marketing and Logistics, Vol. 24 Iss 2 pp. 236-256 http://dx.doi.org/10.1108/13555851211218048 Zafar U. Ahmed, Ishak Ismail, M. Sadiq Sohail, Ibrahim Tabsh, Hasbalaila Alias, (2010),"Malaysian consumers' credit card usage behavior", Asia Pacific Journal of Marketing and Logistics, Vol. 22 Iss 4 pp. 528-544 http://dx.doi.org/10.1108/13555851011090547 Wendy Ming-Yen Teoh, Siong-Choy Chong, Shi Mid Yong, (2013),"Exploring the factors influencing credit card spending behavior among Malaysians", International Journal of Bank Marketing, Vol. 31 Iss 6 pp. 481-500 http://dx.doi.org/10.1108/IJBM-04-2013-0037 Access to this document was granted through an...
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...Credit card companies should not be on campus marketing to college students Credit card companies love college students. They are the prime prospects of credit card companies. There are a couple of reasons they like to get you. First, they have a strong hunch that your parents will bail you out if you run up your credit card bill. Second, you have a long credit life ahead of you. This means lots of years of interest payments for the credit card companies. In the past, credit card companies were so hungry for college students; they approved applications even when students didn't meet the criteria. For example, a college student could get a credit card with no job, no verifiable income, no credit history, and even without a co-signer. Recent changes to credit card law now require credit card companies to verify a student's income before giving a credit card them a credit card. Students without income must get a cosigner to qualify. If you see a credit card company on your campus, they've likely paid your college administrators a fee, sometimes millions of dollars, for the ability to market credit cards to you. Colleges also get a kickback from every credit card opened and sometimes a percentage of charges made. Credit card companies pay to sell credit cards to students because they're banking on students making up for it in interest charges and fees. Expect to see credit card company representatives on or near campus giving out free stuff for credit card applications. Law prohibits...
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...the automated review system that recognizes errors most commonly made by university students in academic essays. The system embeds comments into your paper and suggests possible changes in grammar and style. Please evaluate each comment carefully to ensure that the suggested change is appropriate for your paper, but remember that your instructor's preferences for style and format prevail. You will also need to review your own citations and references since WritePoint capability in this area is limited. NOTE: WritePoint comments are computer-generated writing and grammar suggestions inviting the consideration and analysis of the writer; they are not infallible statements of right/wrong, and they should not be used as grading elements. Also, at present, WritePoint cannot detect quotations or block-quotes, so comments in those areas should be ignored. Please see the other helpful writing resources in the Tutorials and Guides section of the Center for Writing Excellence. Thank you for using WritePoint. Although many Americans may believe that marketing credit cards to college students on campus is setting the student up for financial suicide. There are ["There are" is an awkward phrase if "there" is not clearly a location] many advantages to students whom obtain them. I. Obtaining credit cards helps students build credit. A. Your [Eliminate second person (you, your) in academic documents...
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...debit and credit cards are very useful and convenient. This is especially true for college students. Young people generally depend on debit or credit cards. Nevertheless, the convenience of a debit and credit card does come with a “price to pay”. El Camino restaurants has a minimum debit and credit card purchase of six dollars. This means if a student were to use their debit or credit card to purchase something from the cafe, the total cost would have to add up to six dollars, or else a student cannot use a card. A student that only wants to purchase something for a dollar is unable to do that, because of the policy. Students in college should be free to use their debit or credit card to make purchases, to any amount they desire...
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...MGT. BLENDED 475507 Ethics Case 1 Buy It on Credit and Be True to Your School 1. Should universities enter into agreements to offer affinity credit cards to students? In my opinion, I say no! Universities should not enter into agreements to offer affinity credit cards to students. Credit card companies are promoting through a number of channels to reach students. They offer select affinity card arrangements intended to bypass marketing limits. Universities are founded to prepare students to enter the real world. Universities were not founded to make profit, they are an institution for education. Where students go to learn, and the student should not be used as tools for profit. Consequently, educational institutions shouldn’t enter into agreements to offer affinity credit cards to students. KEY FINDINGS Examination of affinity agreements involving some of the nation's largest and most prestigious colleges revealed that schools and alumni associations: • Sell students' personal information. Many are contractually obligated to share students' names, phone numbers and addresses with banks. • Earn royalties: Banks typically pay schools $1 for each student who keeps a credit card open for 90 days. When students carry a balance, some schools can collect up to $3 more per card. • Cash in each time a student uses plastic: Many schools are entitled to receive 0.4 percent of all retail purchases made with student cards. • Benefit from marketing incentives: When a university...
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...Credit Card Company's Marketing to College Students Credit Card Company's Marketing to College Students The credit card companies marketing their products to college students on campus leads to debt, money management, and unnecessary stress. Ultimately, when they first obtain a credit card they feel some sense of empowerment. Most young adults have typically never had the responsibility of paying bills and managing money compared to an older mature adult. College students should be focused more on receiving their education than dodging creditors on campus looking to inflate their sign up numbers. Getting a credit card too soon can lead to problems down the road. Credit “is no longer considered an earned privilege. It’s now considered a social entitlement and the screening criterion for applicants is weak” (Manning, 2001, p. 157). So a student just signed up for a shiny new piece of plastic with a low to fair credit limit and a very high interest rate because they are considered high risk. If they do not work or have any others sources of income, they can find the trap of debt before they know it. Once the debt piles up, it becomes very hard to recover with no job and no plan in hand. Manning (2001) explains “Credit card companies encourage fantasies of easy money because students are so profitable. Teens have financial naiveté, high material expectations and responsiveness to relatively low-cost marketing campaigns, high potential earnings, and future demand for financial...
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...1980’s, where by the end of the decade the traditional markets for credit cards had become saturated. The middle and working classes already had their plastic of choice and it was time for credit card companies to start looking for alternative ways to bring in revenue. Their solution was simple; in 1990 there were nearly 14 million undergraduate students enrolled in colleges across America. That number was projected to grow as we neared the turn of the century, and it would naturally replenish itself with new students every year. This “new to credit” market was virtually untapped and would provide card issuers with a huge opportunity for growth in both short and long-term areas. If the company could hook college students on their specific brand of credit card, i.e. Visa, MasterCard, American Express, etc., they hoped to secure them as life long, brand-loyal customers. The big companies used very aggressive tactics to secure college students as card users. These companies would go to the universities and strike a licensing agreement, so the card companies could use the college logos on their cards. They never ran a credit check, or even asked how the student would be able to pay off their expenses. They manipulated the students into signing up for credit cards by offering free t-shirts and mugs with the college logo on them. However, not all banks were operating this way. The Louisiana Purchase Bank, LPB, had its card services division stay away from the party atmosphere on campuses...
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...Credit card is a payment card which user can borrow money for payment as a cash advance. Due to its convenience, more and more transactions are settled by credit cards and thus it became popular in recent years. However, the application of credit cards are much more easier nowadays especially for teenagers just over eighteen, therefore the problem of overspending with credit cards exists. If fact, there are three major reasons that lead to overspending of credit cards among teenagers. First of all, most teenagers don't know how to manage their own finance. A research report by Sallie Mae (2009,p2) shows that, there is a recommended 10% of income as a payment of debts for teenagers. However the research has investigated that there are 30% of income as debts payment in reality among teenagers which is $3173 US dollars on average. It also states that teenagers are mismanaging their credit cards by overspending with it and they are unable to pay for the debts in result. To conclude, teenagers just spend all or even more then they have with the help of their own credit cards, resulting in overspending and debts. Secondly, not knowing the serious consequences that bring by overspending among teenagers is also a major reason that cause overspending. A research report by Xiao, J.J & Tang, C.Y & Serido, J & Shim, S, (2011,p4) try to investigate factors that affecting risky borrowing behavior on over 2000 first-year student that have their own credit cards. The result...
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...Graduating from college, obtaining a first job, repaying student loans, and trying to make it in today’s economy are enough for a graduate to worry about. Credit card marketing on college campuses is one way to damage a college student’s financial future. A study was done on TrueCredit.com showing that one out of four students will leave college with $5,000 in debt, and one in ten leaves with more than $10,000 in debt. Credit card companies need to offer these students not their product but even short classes or seminars about their product and how to use it responsibly. But I think schools should draw the line at letting credit cards companies set up on the campus promising financial freedom to young adults with two dollars in his or her pocket. Complicating the matter is the fact that matter is the major universities have partnerships with credit card companies to market cards with the school’s name and logo on the card. Credit card companies prey upon young freshmen as potential clients due to the inadequacy of the knowledge of the knowledge of what entails with a credit card. College students tend to apply for as many cards that will be given. There’s still the thought of more is better. As their first form of independence as an adult, they feel that they shouldn’t ask for advice. This is sometimes what the credit card companies rely on. When a student realizes that his or her grants, money from others, etc. will not cover the high cost of tuition and supplies, they will...
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