The Federal Reserve recently revealed on its Report on College Credit Card Agreements not only the major credit card issuers in the market but also instrumental keys to the success of college affinity programs.
The college affinity programs included contracts for review by the Federal Reserve. The contracts reveal that they are made by the credit card company with fraternities, sororities, and various organizations for professionals.
Credit Chase researcher Alan Banz said that the money that the credit card industry paid colleges and universities to gain access to their market could have also been coursed through these groups in the past. He adds that these groups then had been very instrumental to the introduction of credit card programs in the college or university. Banz believes that it is through these groups that the extent of the college affinity programs impact had been fully realized.
It can be said that the pervasiveness of the credit card industry has affected even the most financially unstable of all the markets including those who are aged 21 and below. Banz argues that individuals in this market who are in the education sector usually have affiliations in the forms of their fraternities and sororities as well as organizations catering to their interests.
More importantly, these same groups are often the recourse for other entities to market themselves to the student populace. He says that these groups are seen as often non-profit and associating causes and interests with them under their mutual benefit and cooperation is what the credit card industry saw as a good chance to expand markets.
Banz opines that the college affinity program agreements made with different college or university fraternities, sororities, and organizations also made it easy for credit card companies to delegate their attendance to the varied credit card needs of the individuals in the market. This time, the operations of the credit card industry happen on a manageable scale in cooperation with those involved in the range of affinity programs.
On the other hand, the students found it even easier to apply for credit card accounts and eventually open them because they find themselves in a support group which legitimizes the practice.
Also with the global economic recession along with hikes in tuition, renting or accommodation, and food and transportation allowances, Banz said that students have had the added internal recognition of their need for credit cards alongside possible external factors affecting their decisions such as those contracts made by their fraternities, sororities, and organizations with different credit card companies.