Many credit card companies get college students to sign up for a credit
card by offering them things in return such as trips, money or even
t-shirts. As a result, some students may focus only on what they are
supposedly getting and fail to notice what will definitely be tacked on
to their deals.
It
isn't until after signing up that students notice that they get a lot
more than they bargained for. Soon, they will be worrying about the
penalty fees and extra prices that they are hit with after purchases.
Some
of the worst credit card industry practices include interest rates that
can expire unexpectedly, over the limit fees, high interest rates,
double-cycle billing (a billing method that charges interest on credit
card debt already repaid by the customer) and changing payment due
dates and late fees. The payment due dates can be changed month to
month, which can easily confuse customers. According to the Web site
created by MASSPIRG to combat this issue in 2006, credit card companies
made over $17 billion in penalty fees.
Last Thursday, MASSPIRG
students at Amherst College combated these credit card deals by openly
criticizing the companies. They dressed up like people who come to
normally represent a credit card company (which they called FEESA), but
instead they had students sign principles for responsible credit card
marketing. It is their hope that the college will adopt these
principles too. They range from banning the practice of giving a free
gift to a student who applies for a credit card to limiting the flyers
or one-on-one time the credit card salesmen have with the students.
"I
think a lot of students knew about the bad deals from credit card
companies, but I don't think a lot of them know that there are
solutions to these problems," said MASSPIRG student Molly Chafetz. "All
of the students were really supportive of the principles because they
had never really thought about them before."
Chafetz also said
that they got a lot of "positive responses" to their fake credit card
company and many students were "excited about the principles."
"I
had no idea how bad these scams were," said University of Massachusetts
student Mary Ritchie. "I mean, I knew about the really obvious ones,
but I didn't know before looking at the Web site that they could be so
terrible. I can't believe that nothing has been done about it at
colleges yet."
The set of principles made by MASSPIRG students could change that. For more information, visit www.truthaboutcredit.org.
