"I believe at last count we had in the mid-20,000 alumni with Virginia Tech affinity cards," Tillar said. "It does provide people with a way to support their school.
Some consumer advocacy groups, such as the Consumer Federation of America based out of Washington D.C. have called into question the relationship between these companies and universities."
The CFA is concerned that the relationship is a conflict of interest and does not have the best interests of the cardholders in mind.
Irene Leech, an associate professor in apparel, housing and tourism management, is currently the vice president of CFA. She has been raising questions about the credit card policies at universities, specifically at Tech.
"It is so important for students to start off on the right foot when it comes to their credit score," Leech said. "We should be encouraging them to act responsibly, but what's been happening is students have been enticed into using credit cards with programs that aren't going to benefit them in the long run."
The plan that students, alumni and staff signed up for with the affinity cards included "double-cycle" billing, where interest is calculated over two months instead of the normally standard one month. This process often results in higher finance charges.
The new bill prohibits double-cycle billing when the monthly payments are made on time. Chase dropped double-cycle billing in early-2009 following the decision not to continue with the university affinity cards.
"They saw that is was costing them too much to keep the program running," Tillar said. "They just weren't seeing enough profits."
Most of the marketing for affinity cards was aimed at alumni, explaining why Chase, Bank of America, MBNA and FirstUSA mainly deal with alumni associations.
"We don't have many students who were issued cards; it's a very small number," Tillar said. "(Chase) mainly likes to market to college graduates because they are a good credit risk. They often make all of their payments on time."
Leech said the positive side of the credit cards offered to students through universities is the ability to learn how to build a credit score.
"This society depends on credit, it is incredibly important for students to learn how to properly use credit," Leech said. "It is very beneficial to learn while in college how to manage credit."
Continue Reading: « Previous12
Leave a comment 2 Comments Write a letter to the editor
All letters to the editor must include a name, e-mail, daytime phone number and affiliation to Virginia Tech. Affiliation includes: year and major for students; position and department for faculty and staff; current city for alumni and parents.
Oh I love Larry Hincker. He is quoted above as saying that cc companies were never allowed to solicit, that they were always working in concert organizations such as an alumni group. Sure Larry, technically perhaps that is true. Perhaps the agreements were specifically written to say that cc companies could only "solicit" if they were working in concert with some other group. In reality everyone knows that VT and/or alumni association, or some other group of adults agreed to sell to a company(ies) the right to be at the games reeling in the next generation of young slaves to debt. Lesson of the day: money makes the world go round.....gotta pay the mortgage :)
Reply to this Top
One of the best classes to take (hands down) at VT is Family Financial Planning (with Ruth Lytton). If you can take it before you graduate it is the most useful class I have taken by far.
Reply to this Top