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On Campus, New Deals With Banks

May 30, 2012

The New York Times

College campuses have long been attractive hunting grounds for financial institutions looking for new customers.

In recent years, however, their efforts to woo students have gotten banks and other financial institutions in trouble with regulators. They are now effectively prohibited from providing gifts to students who sign up for credit cards. And the colleges themselves can no longer be paid by the lenders to steer students to student loans.

But many colleges, struggling to offset cuts in state funds and under pressure to keep tuition down, are finding new ways to strike deals with financial institutions, by turning student IDs into debit cards and allowing lenders to take over disbursement of financial aid.

 

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