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It looks like banks are getting a partner to promote prepaid cards: American universities.In a recent article in Time, Martha White covered the rise of prepaid offerings on college campuses and the benefits some of these schools may receive from marketing them to students.
White’s article highlights the new Wolfpack One card at North Carolina State University, which combines a student ID with a prepaid debit card from U.S. Bank.
Seems like a good way to simplify the load of cards in students’ wallets, right?
Well, it’s also an easy way for the college to earn some additional money. According to the article, the college receives 75 cents per month from each active deluxe prepaid account. With around 34,000 students, you can see how those earnings could add up throughout the year.
White does point out that many of these cards are much more fee-friendly than some of the prepaid offerings we’ve seen, which is clearly good for students. The piece also discusses that these cards are certainly better than some of the credit card offers targeted to students.
Still, I feel like colleges should be steering students toward learning the ins and outs of smart money management through relationships with actual bank accounts instead of prepaid pieces of plastic. Say what you will about banks, but learning to manage funds between checking and savings accounts seems like an important piece of every college student’s growth. Outside of educational lessons in the classroom, shouldn’t college students be learning the importance of monthly savings?
I do understand some users feel that prepaid cards can be used to teach smart spending habits. Since you can’t spend more than you’ve already loaded on the card, students would obviously run into problems once they’ve drained their funds. However, that seems more like learning by force instead of teaching the importance of closely monitoring your money to avoid running out of money.
What do you think?
- Are prepaid cards worthwhile?
- Credit scores & prepaid cards
- Prepaid debit cards gather steam
- Rating prepaid cards for jobless
- Some prepaid fees falling
This story was originally published by Bankrate.