Skip Ribbon Commands
Skip to main content

 Email  Share  Print

Campus Debit Cards

August 15, 2012

 

​Dear Colleague: 

I am writing to make you aware of a letter several higher education associations received July 12 from Sen. Richard Durbin (D-IL) and six other senators expressing interest in working with the higher education community to address concerns raised in a recent report from the U.S. Public Interest Research Group (PIRG), The Campus Debit Card Trap.

The PIRG report is highly critical of business arrangements between financial institutions and colleges and universities to produce student IDs that may also function as debit or prepaid cards and be used to disburse financial aid. The report acknowledges that a well-structured debit card program can provide benefits, but it claims these arrangements may also subject students to high fees, which can consume the resources they need for education expenses.

Responding to the report, the senators outline four areas of concern they would like institutions to address:

  • Promote transparency of these partnerships by publically disclosing the contracts with financial institutions to their campus communities;
  • Negotiate the terms of these arrangements so that students are not charged unreasonable and inappropriate fees for actions such as debit swipes, ATM balance inquiries, inactivity and overdrafts;
  • Take steps to ensure that bank fees are not deducted from disbursed federal financial aid; and
  • Structure these partnerships to protect student privacy, in particular, negotiating a ban on the use of student data for commercial purposes unless explicit consent is given.

The senators also indicated they would like campuses to inform them about best practices being employed to protect students from exploitation.

Last week, one of the largest campus debit card providers agreed to refund approximately $11 million to students for fee overcharges and other debit card-related practices. And while there are a number of flaws in the PIRG report, we are taking steps to gain a fuller and more balanced understanding of the use of debit cards on campus. We also are working with other major higher education associations on this issue, including the National Association of College and University Business Officers, which currently is surveying its members about these partnerships in order to provide a more comprehensive picture of the landscape.

We have been in and will continue discussions of these concerns with the senators and other members of Congress.

We believe you share our collective goal of ensuring that all institutions follow fair and sound practices and that your students' interests are protected. We will make you aware of any significant developments on this matter.

Sincerely,   

Molly Corbett Broad
President, ACE

On behalf of:

American Association of Community Colleges
American Association of State Colleges and Universities
American Council on Education
Association of American Universities
Association of Public and Land-grant Universities
National Association of College and University Business Officers
National Association of Independent Colleges and Universities

Other ACE News

  • July 2, 2015

    Today's Headlines

    HEADLINES: Today's Top Higher Education News

    In today’s headlines, the Los Angeles Times editorializes in favor of the U.S. Supreme Court affirming the University of Texas at Austin’s admissions policy when the court rehears the Fisher case this fall. In other news, The Chronicle of Higher...

  • Institutional Capacity

    July 1, 2015

    Apply Now for ACE’s Institute for New Presidents

    New college and university leaders from all sectors of higher education can apply now for the 2015-16 ACE Institute for New Presidents, which is designed specifically for presidents in their first three years of service.

  • Supporting Student Veterans

    June 29, 2015

    Bob Woodruff Foundation Grant Extends Program to Train College Mental Health Counselors

    A grant from the Bob Woodruff Foundation will allow ACE to extend an initiative that trains college and university mental health counselors on how to better address issues such as post-traumatic stress and suicide prevention in their work treating...

  • June 26, 2015

    Education Department Scales Back Plan to Rate Colleges

    The Department of Education (ED) announced yesterday that it has scaled back the planned Postsecondary Institution Ratings System (PIRS) first announced by President Obama in August 2013.

  • Budget and Appropriations

    June 26, 2015

    Congress Moves Forward on Education Funding

    The House and Senate appropriations committees both passed their FY 2016 Labor, Health and Human Services, and Education bills this week, and the results were somewhat mixed for higher education.

 

 Related Content