Fewer college students are opting for credit cards. A new study from Sallie Mae showed from 2010 to 2012, the number of college students that had their own credit card dropped from 42% to 35%.
I spoke with Missouri State University incoming freshman Hannah Taylor, who is bucking this trend. Taylor said that although she didn’t have a credit card yet, she planned on getting one through the college she was attending.
“When I go to orientation, [the college] give[s] us an opportunity to sign up or get connected with [a credit card offered by the college’s sanctioned bank].” Her school partners with Missouri-based Commerce Bank. It is not uncommon for banks to partner with colleges to offer banking services to their students.
According to the same study, freshmen, like Taylor, who said she’d use the card for gas and books, are less likely to get a credit card than other students. For example, only 21% of freshmen now have credit cards compared to 60% of seniors.
The obvious cause of this downturn in credit card ownership is the CARD Act, that made it more difficult for banks to market their credit cards on campus. Although, the banks are still finding loopholes to market to students.
But another reason for this downturn in student credit card ownership may be the effectiveness of student financial education. Taylor took a required personal finance class (one semester) in high school, where she learned one important lesson about credit card use: “they told us to not use it unless absolutely necessary”.