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U.S. PIRG’s Christine Lindstrom Testifies before U.S. Senate Banking Committee on Campus Debit Cards
“We found in our 2012 report, The Campus Debit Card Trap, that two in five college students in the country are exposed to debit cards on campus that may drive up their costs. Students at some campuses are charged steep and unusual fees to get to their federal financial aid, including PIN transaction fees at the point of sale and overdraft fees at $37 or more. On the whole, these accounts are not necessarily a better deal for students than what they might find through a bank not affiliated with campus.
“One argument that is being make in defense of these campus banking products is that too many low income students are not able to acquire a bank account other than on campus. The Consumer Financial Protection Bureau found that very few students – less than half a percent – are legitimately unable to secure a bank account. . . simply put, students do not need campus sponsored bank accounts.”
“I urge you to consider legislation that bans revenue-sharing agreements between colleges and banks or financial firms crafted specifically to offer bank accounts and related banking products to students on campus. The conflict of interest inherent in these agreements is problematic to the student consumer.”
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