College students and credit cards: A good focus for regulatory reform

The following editorial appeared in the Kansas City Star on Thursday, July 31:

Oh, the solicitations sound so good . . . easy money, free T-shirts, free meals. Apply Instantly!

But when it comes to credit cards and college students, Congress is right to focus some of its industry reform efforts on questionable tactics used to lure new card-holders.

Bills pending in both the House and the Senate are attempting to better regulate firms soliciting students.

Certainly, 18- to 21-year-olds should have some access to credit. Many in that age range are working and raising families.

Establishing a good credit history can help them as they buy their first homes or start businesses.

And having a credit card for emergencies is smart for many college-age people - especially if they are at a campus far from their hometowns and families.

But many university students are also operating on tight budgets or still financially dependent on their parents.

Those students should not fall victim to unscrupulous credit card companies trolling for easy marks.

And their parents do not deserve to be saddled with debt they did not accumulate.

Some firms are clearly not seeking credit-worthy people when they sign up some students without doing credit checks.

Such practices can lead to debts that the young people can ill afford.

People of all ages can benefit from greater financial literacy. Programs that educate at the middle and high school levels could be very effective in instilling sensible spending habits before credit problems occur.

Credit card issuers should do their part by clearly and fairly explaining policies and ratcheting back costs and fees that have increased while billing periods shortened.

Source: http://www.sltrib.com/opinion/ci_10073058