Now credit card companies have to adapt to rules laid down by colleges. The alumni association which has a tie up with the Bank of America which dates back to 1987, and hence has access to the names as well as the addresses of the alumni. The alumni who are from the State University College, Brockport, receive mailings at least twice a year from the bank which markets its Alumni Association credit card.
While Brockport earns $1from the bank for every new account that is being opened, it gets about 25 cents for each transaction that is made on the card. Brockport earned about $18,500 that fiscal year alone. There are many other educational institutions that would be earning much more in the coming years as a result of these tie ups.
The Binghamton University Alumni Association will receive at least over a million during a 7-year period (from the Bank of America), and the alumni of Cornell University will make roughly about 6 million for the same time span (from Chase Bank), although the university has stopped furnishing any more information regarding its alumni. Both these universities utilize the money by providing financial assistance to the alumni events. Cornell also utilizes a part of the money for scholarships etc.
Universities earned enough revenue over the decades by passing on student information. However, card companies are no longer making their presence felt due to the sharp scrutiny they are under, both from parents as well as college authorities.
A state law (2005) in New York brought about some restrictions on credit card companies who used college campuses to promote their products. An agreement has been reached recently with regard to the abuse of credit cards and financial institutions are prohibited from issuing cards to anyone who is below the age of 21 unless and until the young adult has a co-signatory (parent/guardian), alternatively the young adult should be financially independent to repay his/her own debts.
Due to these restrictions in campuses and with student loans running at an all-time high the card companies seem to have shifted their priorities to the alumni. However, the college should inform the alumni that they do have a choice of opting out. Colleges are now trying to distance themselves from the card companies as well as banks at least at the alumni level. Though alumni associations are quite often separate bodies they maintain close links with the colleges. Alumni groups that come under the college's control will have the same disclosure agreements as colleges.