Apply now, pay for it later

Credit card companies target college campuses while students drown in debt.

Last week, Citibank teamed with Domino’s Pizza to lure almost 900 University students into signing up for a credit card with the promise of a free pizza. Marketing schemes such as this aren’t uncommon around campus, but students must be wary prior to signing up.

Some 75 percent of undergraduates have a credit card, and the average undergraduate credit card debt is $2,327. An increasing number of students don’t realize the obligations they face when accepting the buy now, pay later mentality of credit cards, as well as how their credit choices can negatively affect their credit rating.

Credit card companies target student communities because their most profitable populations are those who will accumulate the most debt. With interest rates shooting up to 30 percent and a lack of government regulation, companies such as Citibank can cash in big. Last year alone, Citibank issued five million free student credit cards.

Current credit card contracts and terms make deciphering the fine print extremely confusing, especially to the inexperienced credit user. Oftentimes students don’t realize just how much paying off credit can cost. If a student pays only the minimum on a $5,800 balance at 27.99 percent APR it would take up to 27 years to pay it off.

Citibank and other credit card companies have been under intense scrutiny about their marketing practices on college campuses. In a recent interview with Business Week, a card-company spokesperson said it no longer allows employees or any company it contracts with to solicit students on school grounds. This regulation must be irrelevant on University grounds considering the number of students who were handed a “free” pizza coupon while walking through campus.

Although Jerry Rinehart, vice provost of student affairs, has stated that the advertising on campus grounds violates policy, it is unlikely that companies will discontinue the promotions. The University must find a way to enforce the policy.