For college students, the lure of easy money is everywhere. It comes in the mail, over the phone, through the Internet and even on campus. Students are enticed nearly every day to sign up for a credit card and start using it.
Erin Simpson, a KU senior and member of student senate, resists the temptation to get a credit card, but says the offers to her and her roommates are relentless.
Intrust Bank of Wichita has deals with the alumni associations of Kansas, Kansas State and Wichita State universities to offer affinity credit cards to alumni and students. Under a bill being considered in the state House of Representatives, universities would be prohibited from providing names and addresses for credit card solicitation.
And sometimes they're hard to ignore.
"If they could get rid of it (the solicitations), that would be great," Simpson said.
Across the country, lawmakers and higher education officials are considering restrictions on aggressive credit card solicitation of college students in the wake of reports that many students are spending irresponsibly on credit, falling too deeply into debt and suffering academically.
In Kansas, State Rep. Rocky Nichols, D-Topeka, is trying to shut down the onslaught of credit card solicitations targeting students.
He has introduced legislation that would prohibit credit card companies from soliciting on college campuses. And it would prohibit selling or providing lists of students' and college employees' addresses to credit card companies.
"When Kansas students graduate from our institutions of higher learning, many are leaving with two distinctly different pieces of paper one a diploma and the second a huge credit card debt that can take years to pay," Nichols said.
Opposed by banks
His proposal is being considered by a House budget subcommittee on education. State Rep. Clark Shultz, R-Lindsborg, chair of the subcommittee, said panel members will probably consider the measure this week when they work on the universities' budget proposals.
One of the most powerful lobbying groups in the state, the Kansas Bankers Assn., and Intrust Bank, the largest independent bank in Kansas, oppose Nichols' bill.
Charles Stones, senior vice president of the Kansas Bankers Assn., said college students are adults and should be treated as such.
"Why do we want to assume they are not responsible to make a competent decision regarding credit card solicitation?" he asked.
But Nichols said he doesn't want to prevent college students from being able to get a credit card, if they want one. He just doesn't want the universities to be involved in the promotion of credit cards.
"Our institutions of higher learning have a tough enough job providing Kansas college students with a well-rounded education," Nichols said.
Erin Simpson, a Kansas University student, is getting tired of the hard sell from credit card companies. She said restrictions on solicitations would probably have helped some of her fellow students avoid debt problems.
"The last thing our universities should be worried about is acting as a facilitator or promoter of credit card solicitations."
Teaming with Intrust
If the bill becomes law, it would prohibit the kind of deal that exists between the Kansas University Alumni Association and Intrust Bank of Wichita for credit card solicitation.
Under that deal, the alumni association provides Intrust with names and addresses of KU alumni and students, according to Jennifer Jackson Sanner, senior vice president of the alumni association.
Intrust uses that information to sell credit cards that carry the Jayhawk logo. The bank has sold about 2,500 credit cards to KU students, and 18,000 to alumni, according to an Intrust official.
The alumni association receives an annual royalty from Intrust. Sanner declined to divulge terms of the contract, except to say it's a 12-year deal and was competitively considered.
Intrust has similar deals with the alumni associations at Kansas State University and Wichita State University, she said.
Sanner said the royalties are used for alumni association operations, which in turn benefit KU and its students.
She said the alumni association, in its contract with Intrust, imposed guidelines on the frequency and manner in which the bank could solicit students and alumni. But she refused to say what those guidelines were.
"We feel very good about the way Intrust conducts itself in this area," Sanner said.
Penalized?
Intrust officials say Nichols' bill will penalize them.
The bill would prohibit the bank from setting up on campus to solicit students. But that would not stop solicitations, because most offers are made in the mail, they argued.
The bill would simply prevent Intrust from building customer relationships and open the door wider to giant credit card companies with few or no ties to Kansas, Intrust officials said.
Linda Cullinan, an assistant vice president and marketing manager at Intrust's credit card center, said the bank makes a big effort to educate students on how to budget.
Educational materials on credit and finances are given to students when they apply for a card, receive a card and when they get their bills, she said.
Even so, students such as Simpson say they are getting tired of the hard sell. She said restrictions on solicitations would have probably helped some of her fellow students avoid debt problems.
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