Lawmakers Pressure DOE on Campus Card Rules (July 28, 2014)
New restrictions on campus debit cards being considered by the U.S. Department of Education have the potential to be too far-reaching and severely limit students’ access to financial services, according to more than 40 U.S. lawmakers—senators and representatives, Democrats and Republicans.
The DOE is considering a plan in which any financial institution with an agreement with a college or university would face restrictions on the products it offers to that college/university’s students, even if those products don’t involve Title IV financial aid disbursement. Such a plan could jeopardize the viability of campus cards and other student-focused financial services.
“We support efforts to curb deceptive business practices among bad actors on college campuses,” wrote Rep. Blaine Luetkemeyer (R-Mo.) and Sen. John Hoeven (R-N.D.), in a letter signed by dozens of lawmakers to DOE Secretary Arne Duncan. However, the rules under consideration by the DOE could adversely affect agreements schools have with financial institutions to provide financial products and services, including on-campus bank branches, ATMs and financial education programs, the letter added.
“The products and accounts stemming from these partnerships [between financial institutions and schools of higher education] often have lower costs than those offered to non-students, giving students convenient access to safe, low-cost financial services while helping schools minimize expenses,” stated the letter from Luetkemeyer and Hoeven. Time is a factor for players on both sides of the issue, as the DOE must finalize the rule by Nov. 1, per agency policy, if it wants the new rules in place for the next school year.
See related stories: