There have been many reforms in the past year when it comes to the schemes and programs offered by banks. Those changes do not fall under a specifically good category for the applicants. Fees on checking accounts have been raised, the loyalty points associated with debit cards have been cancelled off, and many other things have happened, making the whole picture not very pleasant. However, there has been one-focus group of applicants that are still reaping benefits at large, and they are the students.
Why Banks Focus on Students
When students go back to their respective colleges, they are going to be presented with a host of new offers by banks. Prolonged promotion period on credit cards, no charges for the checking account, and less stringent regulations for credit cards all this makes the scene more than delightful for the lucky college students. Students are one-focus group of clients that still hold the interest of banks and them being a priority is clearly visible in the fact that all these perks though not clearly stated to be exclusive for students, are being offered to them largely.
Times have shaped in such a manner that banks are highly reluctant of extending any credit and then too when it comes to students they are ready to accommodate. This concession is solely because students are seen as potentially powerful customers for the future, and it is an investment the banks make to strengthen their customer base for the coming days. This strategy works best in the case of credit cards because the older the card; the stronger will be your credit. Many may think that students are not so much of a safe bet but in the broader picture this assessment proves to be wrong. The sole reason for which is that students are known to keep comparatively lower balance and compared to other customer groups are more punctual about their monthly payments.
How Students Benefit
Also, there are a host of new rules that help students be better customers, which only make them more and more of a preferred customer base. For instance now when a student who is of or above the age of twenty-one, when applies for a credit card they are required to submit evidence that supports their mentioned regular source of income. They have to submit details and proofs regarding their assets and also have to have someone vouch for their credit, that is have a Co-signer, all these things packed up together lower down the risk level associated with said student. It is not that banks are not focusing upon making profit, and that is one reason they are trying to find ways to sidestep the ruling that directs them to keep all charges lower than before. In the coming days, banking deals will not get as much revenue as they used to get since the retailers are going to cut back on the card usage, but they are trying to balance out this by issuing more and more pre-paid cards.
For students a very profitable bet at present are the Credit cards, 0 % APR, flexible rules and even better and easier reward earning layouts, credit cards are surely looking up for the student sector. Although all charges associated with checking accounts have increased in the past year, there are plenty specifically tailored for students that are free. Imagine how feasible it would be to open an account with $50, with no charges when you have little to no balance and with no requirement of direct deposit.
As for debit cards most of them are similar to what is offered to people in general. However, there are a few banks who offer some additional benefits to students as students can use any ATM (even those of other banks) for about 4 to 5 times in a month, and they will not be charged for it. As for prepaid cards, the general focus is not students and hence no specific cards are tailored for them but instead their parents are the target group here. However, considering almost all of them charges more or at least $10 a month which affects the balance of the card, prepaid cards are not a very safe deal.