- Safe Student Account Scorecard
- February 26, 2015 | Author: David Head
- Law Firm: Weltman, Weinberg & Reis Co., L.P.A. - Brooklyn Heights Office
In its continued attempt to ensure that agreements between financial institutions and colleges and universities are transparent and favorable to students, the Consumer Financial Protection Bureau (CFPB) is seeking comment on a proposed Safe Student Account Scorecard. The CFPB intends to develop a scorecard for colleges and universities to voluntarily utilize when soliciting agreements from financial institutions.
At the end of 2013, the CFPB requested that financial institutions publicly disclose marketing agreements with colleges and universities. Last summer , the CFPB followed the request with an audit of the agreements between financial institutions and Big Ten schools. The CFPB audit found that only one agreement was fully disclosed.
The financial products offered to students vary from private student loans, credit cards, checking accounts, and debit, prepaid, or stored value cards linked to student ID cards. A competitive bid process is utilized by many schools when selecting bank or non-bank partners that offer these products. However, the CFPB is concerned the account features and the costs of the account features to the student are not heavily weighted in the bid process.
By considering the costs and features of the student financial product in the selection process, colleges and universities will be able to choose financial agreements that are safe and affordable to students. A sample of the scorecard is available for review. The public comment period closes March 16, 2015.