This month, you’re likely to read many stories about the importance — particularly for young people — of understanding compound interest, budgeting and other concepts key to creating a healthy financial life.
April, dubbed National Financial Literacy Month, is traditionally when the personal finance and banking industries celebrate the benefits of knowing how to manage your money.
But a new report suggests that at least for college students, knowing which tools are best for them can be a challenge because certain banks pay universities to advertise their products to students.
“Just because your school or this bank says we’re a great account for students, doesn’t mean you should take it at face value,” said Kaitlyn Vitez, the higher education campaign director at U.S. PIRG, a consumer advocacy group, and one of the authors of the report.
During the 2017-2018 academic year, banks including Wells Fargo, WF, -2.41% PNC PNC, +1.42% and U.S. Bank USB, +0.79% compensated 95 colleges across the country to allow the companies to market their debit card and checking account products to students, an analysis of a government database of the contracts by the Education Fund at U.S. PIRG and Frontier Group, a left-leaning think tank. (PNC and U.S. Bank did not respond immediately to a request for comment.)
‘We value the relationships we have with students and colleges and universities across the country.’
— Ed Kadletz, head of Wells Fargo’s Deposit Products Group
These agreements allow banks to send students pitches about their products through their school email addresses and acceptance and orientation materials. In addition, they often allow the bank to co-brand its account and card with the college or link students’ campus IDs to their bank account. And in many cases, the schools are incentivized to allow banks greater