CREDIT CARDS

Marketing to College 

Students Appears to 

Have Declined

Report to Congressional Committees

February 2014

GAO-14-225

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-225, a report to 

congressional committees

February 2014

CREDIT CARDS

Marketing to College Students Appears to Have 

Declined

Why GAO Did This Study

Institutions of higher education, alumni 

groups, and other affiliated 

organizations may enter into 

agreements with credit card issuers for 

“college affinity cards,” in which issuers

use the institution’s name or logo in 

exchange for payments. Separately, 

some credit card issuers offer “college 

student credit cards,” which are 

expressly targeted to students. Partly 

in response to concerns about card 

issuer practices and rising student 

credit card debt, Congress passed the 

Credit Card Accountability 

Responsibility and Disclosure Act of

2009. The act includes consumer 

protections and requires disclosures 

specifically for consumers under the 

age of 21, including limits to oncampus credit card marketing and 

requirements for public disclosure of 

affinity card agreements. The act 

mandates that GAO review these 

agreements and assess their effect on

student credit card debt. 

This report examines (1) trends 

associated with and characteristics of 

college affinity card agreements, (2) 

the extent of marketing for college 

affinity cards and college student credit 

cards, and (3) what is known about the 

effect of use of these cards on student 

credit card debt. GAO analyzed data 

from the Federal Reserve and CFPB,

including a sample of 39 affinity 

agreements filed by the issuers. GAO 

also analyzed data on student credit 

card use or indebtedness, and

interviewed officials from federal 

agencies, credit card issuers, and 

affiliated organizations.

What GAO Recommends

GAO makes no recommendations in 

this report.

What GAO Found

Trends associated with college affinity card agreements include fewer 

agreements and cardholders and declining payments, according to data GAO 

analyzed from the Board of Governors of the Federal Reserve System (Federal 

Reserve) and the Bureau of Consumer Financial Protection (CFPB). The number 

of affinity card agreements declined from 1,045 in 2009 to 617 in 2012 (41

percent). More than 70 percent of the agreements in 2012 were with institutions 

of higher education or alumni organizations, and one issuer—FIA Card Services, 

a subsidiary of Bank of America—had 67 percent of all agreements. Affinity card 

issuers paid $50.4 million to all organizations in 2012, 40 percent less than in 

2009. In most cases, payments were based on numbers of cardholders and the 

amount spent on the cards. The card agreements covered contractual obligations 

related to such things as marketing practices, target populations, use of the 

organization’s logo or trademark, terms of payment, and, in some cases, service 

standards. 

Student-focused marketing of affinity and student cards on campus appears to 

have declined. Four large affinity card issuers GAO interviewed (representing 91

percent of cardholders) said that they primarily targeted alumni and no longer 

marketed affinity cards directly to students. In interviews with GAO, institutions of 

higher education and affiliated organizations agreed that affinity card marketing 

directly to students had ceased. In addition, five of the nine largest overall credit 

card issuers that also issue college student credit cards told GAO they no longer 

actively marketed these cards (such as through direct mail, e-mail, or on-campus 

activity), but rather relied upon websites and bank branches. Representatives of 

five institutions with large affinity card agreements told GAO that they generally 

noticed a decline in on-campus credit card marketing in recent years. Consistent 

with these observations, available data show a decline in card solicitations to 

students in recent years. For example, a survey of students in 2013 by Student 

Monitor, a research firm, found that 6 percent of students reported obtaining a 

credit card as a result of a direct mail solicitation, compared with 36 percent in 

2000.

Data are not available to definitively determine the effect that affinity cards and 

college student credit cards have had on student credit card debt. For affinity 

cards, the effect may be limited because fewer students appear to hold such 

cards. For college student credit cards, the effect is difficult to determine because 

data are available for credit cards in general but not for student credit cards in 

particular. However, students’ overall use of credit cards appears to have 

declined in recent years. For example, Student Monitor reported 33 percent of 

students owned credit cards in 2013 versus 53 percent in 2004, a trend 

corroborated by several other studies that GAO identified. But Student Monitor

found that students with credit cards in their names increasingly obtained the

cards before starting college. In addition, it found that in 2013, students charged 

an average of $171 monthly on their cards, 80 percent of the cards had a credit 

limit of $1,000 or less, and 72 percent of students said they paid their outstanding 

charges in full each month. Student Monitor also reported that one quarter of 

students in 2013 paid a late payment fee at least once since they acquired the 

credit card, with almost half of those paying more than once.

View GAO-14-225. For more information, 

contact Alicia Puente Cackley at (202) 512-

8678 or cackleya@gao.gov.
Page i GAO-14-225 College Credit Cards

Letter 1

Background 3

Changes in the College Affinity Card Market Since the CARD Act 6

Marketing to Students Appears to Have Declined 16

Effect of College Affinity and Student Cards on Student Credit 

Card Debt Largely Is Unknown 21

Agency Comments 28

Appendix I Objectives, Scope, and Methodology 29

Appendix II GAO Contact and Staff Acknowledgments 37

Tables

Table 1: College Affinity Card Agreements, Cardholders, and New 

Cardholders, 2009-2012 6

Table 2: Affinity Card Agreements, Cardholders, and New 

Cardholders, by Organization Type, 2009-2012 8

Table 3: Number of Agreements by Issuer, 2009-2012 10

Table 4: Total Payments, Average Payments, and Median 

Payments from Affinity Card Issuers to Organizations, by 

Organization Type, 2012 11

Table 5: Prevalence of Target Markets/Members in 39 Reviewed 

Agreements 13

Table 6: Prevalence of Marketing Approaches in 39 Reviewed 

Agreements 14

Table 7: Prevalence of Payment Types in 39 Reviewed 

Agreements 15

Table 8: 2011 College Credit Card Agreements Selected for 

Review, by Institution Type, Issuer, and Size Categories 31

Figures

Figure 1: Prevalence of Affinity Card Agreements by Organization 

Type, 2012 7

Figure 2: Number of Affinity Card Agreements, by Organization 

Type, 2009-2012 8

Contents
Page ii GAO-14-225 College Credit Cards

Figure 3: Number of Affinity Card Agreements, FIA Card Services 

and Other Issuers, 2009 and 2012 9

Figure 4: Length of Time (in Years) That Organizations Had a 

College Affinity Card Agreement, for 38 Agreements 

Reviewed 12

Figure 5: Percentage of Students Obtaining Their Credit Cards, by 

Method of Solicitation, 2000 and 2013 20

Figure 6: Percent of Students Who Reported Owning a Credit 

Card, 2010-2013 24

Figure 7: Time Period of Credit Card Acquisition for Students with 

Credit Cards, 2000 and 2013 26

Abbreviations

CFPB Bureau of Consumer Financial Protection

DCI data collection instrument

This is a work of the U.S. government and is not subject to copyright protection in the 

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without further permission from GAO. However, because this work may contain 

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Page 1 GAO-14-225 College Credit Cards

441 G St. N.W.

Washington, DC 20548

February 25, 2014

The Honorable Tim Johnson

Chairman

The Honorable Mike Crapo

Ranking Member

Committee on Banking, Housing, and Urban Affairs

United States Senate

The Honorable Jeb Hensarling

Chairman

The Honorable Maxine Waters

Ranking Member

Committee on Financial Services

House of Representatives

Institutions of higher education and affiliated organizations, such as 

alumni associations, sometimes have agreements with credit card issuers 

for “college affinity cards.” These cards often bear the name or logo of the 

school or organization, and, in return, the issuer pays a portion of the 

proceeds of the credit card to the school or organization. In addition, 

some card issuers offer “college student credit cards” that are unaffiliated 

with a particular institution but designed specifically for college students. 

Consumer advocates and some members of Congress have had 

concerns in recent years about student credit card debt and the marketing 

practices, such as on-campus solicitations, used to enroll students in 

cards.1

To address some of these concerns, Congress passed the Credit Card 

Accountability Responsibility and Disclosure Act of 2009 (CARD Act).2

 1

We conducted a separate review on debit and prepaid cards offered to students through 

agreements between schools and financial service providers. GAO, College Debit Cards: 

Actions Needed to Address ATM Access, Student Choice, and Transparency, 

Among other things, the act requires card issuers to file annually with 

federal regulators the terms and conditions of their college affinity credit 

card agreements with institutions of higher education or affiliated 

GAO-14-91

(Washington, D.C.: Feb. 13, 2014).

2

Pub. L. No. 111-24, 123 Stat. 1734. 
Page 2 GAO-14-225 College Credit Cards

organizations.3 The CARD Act also mandates that we report on several 

issues related to college affinity and college student credit cards.4

To address our first objective, we reviewed annual reports submitted to 

Congress by the Board of Governors of the Federal Reserve System 

(Federal Reserve) and the Bureau of Consumer Financial Protection, also 

known as the Consumer Financial Protection Bureau (CFPB), and 

analyzed the public database of agreements that are reported by issuers 

annually to them. We assessed the reliability of these databases by 

interviewing Federal Reserve and CFPB officials knowledgeable about 

the data and checking the data for illogical values or obvious errors. We 

found the data to be sufficiently reliable for describing the general 

characteristics and trends of the affinity card marketplace. For in-depth 

analysis, we further selected a subset of active agreements using a 

nonprobability sample of 39 college affinity card agreements between 

issuers and institutions of higher education or affiliated organizations from 

2011 (the most recent year for which the agreements were available).

This 

report examines (1) the trends associated with and characteristics of 

college affinity card agreements, (2) the extent of marketing for college 

affinity and college student credit cards, and (3) what is known about the 

effect of the use of affinity cards and student credit cards on student 

credit card debt.

5

 3

§ 305(a), 123 Stat. at 1749-50 (codified at 15 U.S.C. § 1637(r)(2)). 

The sample included the agreements with the largest number of 

cardholders overall, for each issuer, and for institutions of higher 

education. Collectively, the agreements in our sample covered about 38 

percent of all cardholders associated with affinity credit cards in 2011, 

which allows us to make statements of context and describe multiple 

factors relating to college credit card agreements. Findings from this 

limited review cannot be generalized to the overall population of all 

agreements for college affinity cards in 2011. We also interviewed 

representatives of six institutions of higher education and affiliated 

4

The CARD Act mandates that we review the annual reports submitted by card issuers as 

well as their marketing practices to determine the impact that college affinity card 

agreements and college student card agreements have on credit card debt. § 305(b), 123 

Stat. at 1750-51. 

5

Results from nonprobability samples cannot be used to make inferences about a 

population, because in a nonprobability sample some elements of a population being 

studied have no chance or an unknown chance of being selected as part of the sample.
Page 3 GAO-14-225 College Credit Cards

organizations, including those party to three of the four largest 

agreements, as determined by number of cardholders. For the second 

and third objectives, we reviewed studies, such as those by Sallie Mae 

and Student Monitor, on student credit card use or indebtedness.6

We conducted this performance audit from December 2012 to February 

2014 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.

We 

assessed these data by interviewing Student Monitor and Sallie Mae 

officials knowledgeable about the data and checked the data for illogical 

values or obvious errors and found them to be sufficiently reliable for 

providing general information on student credit card use. Furthermore, we 

interviewed representatives of seven credit card issuers, which included 

the five largest general credit card issuers as determined by portfolio size 

in 2011. Four of these seven issuers offered affinity credit cards, 

representing 91 percent of the affinity card market in 2012, as measured 

by number of cardholders. Five of these seven issuers also offered 

student credit cards. Finally, we interviewed academics and 

representatives of federal agencies and other organizations that have 

studied issues related to college affinity cards or college students’ credit 

card use.

Almost 537 million general-purpose credit cards were in circulation in the 

United States as of the end of 2012.7

 6

Sallie Mae originates and services loans to and collects loans from students and families 

to help them finance the cost of their education. Student Monitor is a market research firm 

focused exclusively on the student marketplace. 

Since at least the early 1990s, 

some credit card issuers have offered college affinity cards, which are 

governed by contracts (agreements) between the issuer and an 

organization such as a college, university, or alumni association. The 

cards typically bear the organization’s logo. In return, the issuer makes 

payments to the organization based on factors such as the number of 

cards issued or the amount charged to the cards. College affinity cards 

7

The Nilson Report, no. 1012 (February 2013).

Background
Page 4 GAO-14-225 College Credit Cards

can be an effective way for issuers to market credit cards because 

college alumni often have an attachment to their schools.

In addition, some credit card issuers, including banks and credit unions, 

offer college student credit cards—cards that are specifically labeled and 

intended for college students. As of November 2013, 6 of the 10 largest 

credit card issuers offered these cards, such as Citibank’s Citi Dividend 

Card for College Students and Bank of America’s BankAmericard Cash 

Rewards for Students.8 Issuers use these cards to help build a base of 

customers who may continue using the issuers’ credit cards after 

graduation. The terms and conditions of college student credit cards may 

be somewhat different from those of other credit cards—for example, they 

may have lower initial credit limits.9

In 2009, the CARD Act changed the marketing and terms and conditions 

of credit cards for young people, requiring additional consumer 

protections and disclosures for students and consumers under the age of 

21.10

• any new credit card application for someone under 21 contain either 

(1) a co-signer over 21 who has the ability to make payments on the 

debts from the account and who will be jointly liable for debts incurred 

by the applicant until he or she is age 21, or (2) supporting information 

showing that the applicant would have the independent ability to make 

payments on any debt incurred from the use of the card (an “ability to 

pay”);

Among other things, the act requires that

• co-signers of such accounts approve increased credit lines until the 

cardholder is 21;

• card issuers not obtain a credit report for someone under 21 to use to 

make an unsolicited prescreened credit offer; and

 8

Largest credit card issuers as measured by the number of general-purpose credit cards 

in circulation in 2012, the most recent year for which data were available, according to The

Nilson Report, no. 1012 (February 2013). The six issuers were Capital One Financial 

Corporation, Citigroup Inc., Bank of America Corporation, Discover Financial Services, 

U.S. Bancorp, Wells Fargo & Company, and Barclays Bank Delaware. 

9

We previously reported on college students’ credit card use in 2001. See GAO, 

Consumer Finance: College Students and Credit Cards, GAO-01-773 (Washington, D.C.: 

June 20, 2001). 

10Pub. L. No. 111-24, §§ 301-304, 123 Stat. 1734,1747-49.
Page 5 GAO-14-225 College Credit Cards

• card issuers and creditors not offer a student any tangible item to 

induce the student to apply for or participate in a credit card on or 

near the campus of the institution of higher education or at an event 

sponsored by or related to an institution of higher education.

The act also requires credit card issuers to submit to CFPB each year the 

terms and conditions of any college affinity credit card agreement 

between the issuer and an institution of higher education or an affiliated 

organization in effect at any time during the preceding calendar year.11 In 

addition to a copy of any college credit card agreement to which the 

issuer was a party, issuers also must submit summary information for 

each agreement, such as the number of cardholders covered with 

accounts open at year-end (regardless of when the account was opened) 

and the payments made by the issuer to the institution or organization 

during the year.12 CFPB must submit to Congress, and make available to 

the public, an annual report that contains the information submitted by the 

card issuers to CFPB.13 On December 17, 2013, CFPB issued the fourth 

annual report, which covered the 2012 calendar year.

 11§ 305(a); 12 C.F.R. § 1026.57(d). Implementation of the CARD Act, including receipt of 

the issuer submissions, was vested originally with the Federal Reserve but transferred to 

CFPB on July 21, 2011, pursuant to the Dodd-Frank Wall Street Reform and Consumer 

Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010).

12§ 305(a): 12 C.F.R. § 1026.57(d). Issuers also must provide the number of new 

cardholders who opened accounts during the year, and any memorandum of 

understanding between the issuer and school or affiliated organization that directly or 

indirectly relates to any aspect of the agreement. Id.

13§ 305(a). The Federal Reserve submitted the 2009 and 2010 reports, and CFPB 

submitted the 2011 and 2012 reports.
Page 6 GAO-14-225 College Credit Cards

Since the CARD Act was passed in 2009, the numbers of college affinity 

card agreements and cardholders have decreased, according to data 

from the Federal Reserve and CFPB. From 2009 through 2012, the 

number of card agreements declined from 1,045 to 617 (41 percent). 

Similarly, the total number of cardholders for college affinity cards 

declined by 40 percent (see table 1).

Table 1: College Affinity Card Agreements, Cardholders, and New Cardholders, 2009-2012 

2009 2010 2011 2012

Net change,

2009–2012

Percent change, 

2009–2012

Number of agreements 1,045 1,005 796 617 (428) -41%

Number of cardholders as of Dec. 31 2,041,511 1,709,054 1,503,664 1,222,718 (818,793) -40%

Number of new cardholders 55,747 46,385 43,227 45,519 (10,228) -18%

Source: CFPB.

In 2012, 43 percent of the 617 college affinity card agreements were with 

alumni associations and 28 percent were with a college, university, or 

other institution of higher education (see fig 1).

Changes in the 

College Affinity Card 

Market Since the 

CARD Act

Number of Card 

Agreements, Cardholders,

and Payments Declined in 

2009–2012
Page 7 GAO-14-225 College Credit Cards

Figure 1: Prevalence of Affinity Card Agreements by Organization Type, 2012

Note: The percentages in the four categories do not add up to 100 percent due to rounding. “Other”

includes fraternities, sororities, and professional or trade organizations, as well as agreements with 

multiple organizations, such as a university and an alumni association.

Among these organization types, the greatest decline in the number of 

card agreements since 2009 was for institutions of higher education (see 

fig. 2).
Page 8 GAO-14-225 College Credit Cards

Figure 2: Number of Affinity Card Agreements, by Organization Type, 2009-2012

In contrast, the largest decline in the number of overall cardholders 

occurred within alumni associations, while “other” organizations (a 

category that includes fraternities, sororities, and professional or trade 

organizations) had the largest decrease in the number of new cardholders

(see table 2).

Table 2: Affinity Card Agreements, Cardholders, and New Cardholders, by Organization Type, 2009-2012

Number of agreements Number of cardholders Number of new cardholders 

Net change % Change Net change % Change Net change % Change

Alumni association (81) -23% (290,196) -28% 3,779 13%

Foundation (36) -43% (55,238) -41% (2,137) -53%

Institution of higher education (238) -58% (230,732) -51% (4,077) -32%

Other (including multiple 

organizations)

(73) -37% (242,627) -57% (7,793) -73%

Total (428) -41% (818,793) -40% (10,228) -18%

Source: GAO analysis of Federal Reserve and CFPB reports.

Note: Reported numbers include corrections filed with the Federal Reserve and CFPB after the initial 

report was issued.
Page 9 GAO-14-225 College Credit Cards

In 2012, 23 credit card issuers offered college affinity cards.14

Figure 3: Number of Affinity Card Agreements, FIA Card Services and Other Issuers, 2009 and 2012

One 

issuer—FIA Card Services, N.A., a subsidiary of Bank of America—had 

412 of the 617 reported agreements (67 percent of the market). However, 

as seen in figure 3, the company’s market share has dropped since 2009.

Most affinity card issuers had a small number of card agreements—for 

example, the majority of issuers had one or two affinity card agreements 

(see table 3).

 14We counted two entities that filed agreements separately–Capital One Bank (USA), N.A. 

and Capital One, N.A.–as a single issuer because both are subsidiaries of Capital One 

Financial Corporation. 
Page 10 GAO-14-225 College Credit Cards

Table 3: Number of Agreements by Issuer, 2009-2012

2009 2010 2011 2012 Net Change, 2009–2012

FIA Card Services, N.A. 906 848 633 412 (494)

Capital One Banka 1 10 32 55 54

U.S. Bank National Association ND 60 54 51 48 (12)

UMB Bank, N.A. 6 23 22 39 33

Chase Bank USA, N.A. 36 28 17 15 (21)

Pennsylvania State Employees Credit Union 13 13 13 14 1

INTRUST Bank, N.A. 8 9 10 10 2

USAA Savings Bank 1 2 2 4 3

Compass Bank 1 2 3 2 1

GE Capital Retail Bank 3 2 2 2 (1)

Michigan State University Federal Credit Union 1 2 2 2 1

Oregon Community Credit Union and OCCU Card Services, LLC - - - 2 2

Pen Air Federal Credit Union - 1 1 2 2

Banco Popular de Puerto Rico 1 1 1 1 -

Barclays Bank Delaware 1 1 1 1 -

Carolina Trust Federal Credit Union - 1 1 1 1

Elevations Credit Union 1 1 1 1 -

MIT Credit Union - - - 1 1

PNC Bank, National Association 2 2 1 1 (1)

Purdue Federal Credit Union 1 1 1 1 -

University of Illinois Employees Credit Union - 1 1 1 1

USC Credit Union - 1 1 1 1

Wright-Patt Credit Union, Inc. - - - 1 1

Commerce Bank, N.A. 1 - - - (1)

First National Bank of Omaha 2 2 - - (2)

Total 1,045 1,005 796 617 (428)

Source: GAO analysis of Federal Reserve and CFPB reports.

a

Includes agreements filed by Capital One Bank (USA), N.A. and Capital One, N.A.

The payments that card issuers made to institutions with which they had 

affinity card agreements have decreased since 2009, consistent with the 
Page 11 GAO-14-225 College Credit Cards

decline in the number of agreements and cardholders.15

Table 4: Total Payments, Average Payments, and Median Payments from Affinity 

Card Issuers to Organizations, by Organization Type, 2012 

As shown in 

table 4, affinity card issuers made payments of $50.4 million to 

participating institutions in 2012. The median payment in 2012 was about 

$5,000, while the average (mean) was about $82,000, with alumni 

associations receiving the highest average payment.

Total 

payments

Average 

payment

Median 

payment Range

Alumni association $30,805,378 $115,376 $6,163 $0 - $2,742,743

Institution of higher 

education

11,791,359 67,379 3,252 0 - 1,505,550

Other 4,239,222 33,645 6,413 0 - 898,924

Foundation 3,560,142 74,170 1,833 0 -1,157,737

Total (overall) $50,396,102 $ 81,812 $ 5,062 $0 - $2,742,743

Source: GAO analysis of CFPB data.

Note: Numbers may not add to the shown total because of rounding.

Total payments declined by 40 percent between 2009 and 2012. The 

largest decline in payments was to alumni associations, while institutions 

of higher education had the largest decline in affinity card agreements 

over this period. However, during that period, the average payment to 

institutions of higher education increased by about $13,200, while the 

average payment to alumni associations decreased by about $13,700. 

The University of Southern California, through its agreement with FIA 

Card Services, received about $1.5 million, the largest payment to an 

institution of higher education in 2012. Among all the organizations, the 

Penn State Alumni Association received the largest payment in 2012—

about $2.7 million, from FIA Card Services. In contrast, 22 percent of the 

agreements did not result in any payments to organizations in 2012.

 15Because some agreements include the provision of financial products (such as deposit 

accounts) in addition to credit cards, payments made by issuers under these agreements 

may not relate solely to credit card accounts.
Page 12 GAO-14-225 College Credit Cards

College affinity card agreements serve as contracts between the card 

issuer and the participating organization. Using a data collection 

instrument, we reviewed 39 agreements filed with CFPB, which 

represented about 38 percent of all cardholders covered by college 

affinity card agreements in 2011.16

Figure 4: Length of Time (in Years) That Organizations Had a College Affinity Card 

Agreement, for 38 Agreements Reviewed

The agreements typically covered 

such things as the card’s target market, marketing practices, and 

payments to the participating organization. As shown in figure 4, the 

length of time that the card agreements had been in effect varied. The 

oldest originally was signed in January 1991 and the most recent in 

December 2011. Many of the agreements had been amended or received 

addendums since they were first adopted, which in some cases extended 

the existing terms of the original agreement.

Note: One of the 39 agreements we reviewed did not include dates and is not included in this 

analysis.

 16Many of the agreements we reviewed contained multiple amendments or addendums. 

We focused our review on the most recent full agreement or amendment and those items 

that were still in effect. See appendix I for a list of the agreements we reviewed.

Card Agreements Can 

Cover Target Customers, 

Payments, and Marketing 

Practices
Page 13 GAO-14-225 College Credit Cards

In addition to credit cards, 30 of the 39 agreements included other 

financial products, such as deposit and checking accounts, automobile 

and home loans, and investment accounts. Some agreements included 

exclusivity provisions that restricted the organization from offering its 

members these products except in conjunction with the current affinity 

card issuer.

The agreements identified which potential cardholders the issuer could 

solicit and how. Thirty-seven of the 39 reviewed agreements identified 

specific target customers for the college affinity card. Most often, issuers 

targeted alumni for the cards, but two-thirds of the agreements also 

allowed the issuers to solicit undergraduate students (see table 5).17

Table 5: Prevalence of Target Markets/Members in 39 Reviewed Agreements 

Most 

of the agreements identified multiple target populations for card 

solicitations.

Target market

Number of agreements 

identifying this target market

Alumni 35

Students (undergraduate) 26

Employees 22

Season ticket holders/fans 22

Donors or friends 22

Parents 10

Other (graduate students, organization members, 

etc.)

23

Source: GAO.

Note: Agreements often cited more than one target market.

All but two of the 39 reviewed agreements included provisions requiring 

the organization to provide a list of its members to the issuer for 

marketing purposes. However, two-thirds of the agreements included 

mechanisms allowing the organizations to exclude members who 

requested that they not receive third-party solicitations. Nine of the 

 17As discussed later, while many agreements allow students to be a target market for the 

affinity cards, all of the issuers and affiliated organizations with which we spoke told us 

that, in practice, no issuers actively market to students at the present time.

Target Customers and 

Marketing Practices
Page 14 GAO-14-225 College Credit Cards

reviewed agreements also included restrictions on soliciting student 

members, generally by restricting their inclusion on the provided lists.

The agreements allowed card issuers to solicit potential cardholders 

through a variety of methods (see table 6). More than 80 percent of the 

reviewed agreements allowed issuers to use telemarketing, website links 

(such as from the alumni association’s website), direct mail, and print 

advertisements (such as in sport programs or member magazines). All of 

the reviewed agreements allowed the issuers to use more than one of the 

different methods that we tracked.

Table 6: Prevalence of Marketing Approaches in 39 Reviewed Agreements 

Marketing method

Number of agreements including 

this marketing method

Use of trademark/logo/mascot 39

Print advertisements 37

Direct mail 37

Links on website 34

Telemarketing 32

Access to campus 30

E-mail or Internet solicitations 30

Source: GAO.

Note: Agreements included more than one marketing method.

All of the reviewed agreements included provisions allowing the card 

issuers to use the trademark or logo of the institution of higher education 

or organization. In some instances, the issuer could put these trademarks 

on gifts for individuals who completed applications or on other items. All 

but two of the agreements included provisions for obtaining prior approval 

of marketing materials from the organization or institution (to help ensure 

that the card issuer used the trademark or logo appropriately).

All but one of the 39 reviewed agreements contained information about 

the payment arrangement between the issuer and the affiliated 

organization or institution of higher education. As shown in table 7, 

issuers most frequently provided payments to the organization or 

institution based on the number of new and open cards and the amount of 

money charged to the cards. Many included bonus payments for 

accounts that the organization or institution originated (as opposed to 

ones originated through the issuer), and three included bonus payments if 

the number of cardholders exceeded a threshold. Many of the 

Payments to Organizations 

under the Agreements
Page 15 GAO-14-225 College Credit Cards

agreements also included a guaranteed payment to the organization or 

institution that was not based on the number of cardholders or amount 

charged.

Table 7: Prevalence of Payment Types in 39 Reviewed Agreements

Type of payment

Number of agreements including 

this payment type

Payment per new card 31

Payment based on number of open cards 31

Payment based on spending volume 31

Guaranteed payment 27

Payment for funded savings or checking account 16

Source: GAO.

Note: Agreements often included more than one type of payment.

The reviewed agreements sometimes contained payments based on 

other related products or included broader financial support to the 

organization or institution. For example, some payments under the 

agreements were based on balances of certificates of deposit or loans 

provided. In some instances, the reviewed agreements included support 

for scholarships or building renovations.

About one-quarter of the 39 reviewed agreements included explicit 

consumer or cardholder protections or service standards. The consumer 

protections included restrictions on how often and how issuers could 

solicit group members, as well as restrictions on the sharing of the 

member database or student information with third parties. Two of the 

reviewed agreements also included metrics to assess servicing 

standards. For example, one agreement with an alumni association 

specified how quickly the issuer would answer and resolve calls and also 

required that the credit card terms and features (such as fees and annual 

percentage rates) be “best in class” when compared with a set of 

identified peer institutions. Additionally, most of the reviewed agreements 

included provisions allowing the issuer to make periodic adjustments to 

the card program and its terms and features.

Consumer Protections and 

Service Standards
Page 16 GAO-14-225 College Credit Cards

According to available data and representatives of card issuers and 

affiliated organizations, marketing of college affinity cards and college 

student credit cards directly to students appears to have declined.

As of 2013, college affinity cards were not being marketed directly to 

students, according to representatives of issuers and affiliated 

organizations with whom we spoke. Four large issuers of affinity cards, 

representing 91 percent of the market (as measured by 2012 

cardholders), said they did not actively market these cards to students—

that is, they did not market on campus or specifically target students 

through direct mail, e-mail, print or broadcast media, or their other 

marketing venues.18

Before the enactment of the CARD Act in 2009, it was not uncommon for 

college affinity cards to be marketed to students. Representatives of four 

organizations with college affinity cards told us that at one time their cards 

were targeted to students, and, as discussed earlier, card agreements 

often specified students as a target market and required sharing student 

contact information for marketing purposes. However, many of the new 

agreements—and amendments to existing agreements—we reviewed

that were put in place after 2009 expressly limit or restrict the marketing 

of college affinity cards to students.

Representatives of five affiliated organizations with 

affinity credit card agreements corroborated these statements; they told 

us that the card issuers no longer marketed their affinity cards to 

students, focusing instead on alumni. The issuers noted that it was still 

possible that some students applied for college affinity cards because 

they would see the same marketing as the general public—such as 

advertising at bank branches, sporting events, or on issuer websites. 

Graduate students also may receive card solicitations from their 

undergraduate schools or alumni organizations. Officials from three 

affiliated organizations estimated that the percentage of their current 

cardholders who still were students was less than 3 percent and that 

these percentages had been declining.

 18One of the four issuers noted that because it was planning to exit the college affinity 

card marketplace, it was no longer marketing its affinity credit cards to any population. 

Marketing to Students 

Appears to Have 

Declined

Largest Issuers of Affinity 

Credit Cards Stated They 

No Longer Marketed the 

Cards Directly to Students
Page 17 GAO-14-225 College Credit Cards

Views diverged on the extent to which the CARD Act was responsible for 

the decline in marketing of college affinity cards to students. One card 

issuer told us the act had little influence because the company had begun 

reducing marketing cards to students before the statute was enacted. A 

second issuer said it did not market to students because it sought more 

affluent customers, but it acknowledged the CARD Act also played a role 

by making it more difficult and less efficient to market to students—for 

example, placing restrictions on making prescreened credit offers to those 

under 21. Representatives of three organizations with college affinity 

cards told us they believed the CARD Act played a significant role in the 

decline of card marketing to students. Institutions of higher education also 

may have influenced this decline—for example, representatives of one 

college told us that undergraduate students were not included in its 

program or targeted for marketing, largely because the college did not 

want to be seen as pushing credit cards on its students.

Marketing of college affinity cards overall—not just to students—has 

declined in recent years as many large issuers have diminished their 

presence in the marketplace. As discussed earlier, the number of 

agreements and cardholders declined by 41 percent and 40 percent, 

respectively, from 2009 through 2012. Three of the four affinity card 

issuers told us they were not actively seeking additional agreements.

Specifically, one issuer said it was exiting the marketplace as existing 

agreements expired, one said it was evaluating the performance of its 

existing portfolio before deciding a future direction, and one said it was 

evaluating each agreement as it expired and did not regard its college 

affinity card business as strategically important. The fourth issuer noted 

that while it was seeking new agreements, it had ended many of its 

existing agreements because it did not see the program being sustainable 

over the long term.

Although some card agreements provide payments to the affiliated 

organizations based on the number of card accounts, organizations told 

us they generally played a limited role in marketing the cards to their 

members. Three of the five organizations had sent e-mails to their 

members promoting the cards. One of these organizations told us it would 

like to do additional marketing of its own but that the issuer had been 

reluctant to permit this. Two organizations were concerned that 
Page 18 GAO-14-225 College Credit Cards

participation in marketing could affect the tax status of their payments 

under the agreements.19

Active marketing of college student credit cards appears to have declined 

in recent years. We spoke with five issuers of these cards, which 

represented 39 percent of all general-purpose credit cards in circulation 

as of December 2012.20

Representatives of affiliated organizations with whom we spoke 

confirmed they had observed a reduction in the marketing of credit cards 

to students in recent years. For example, they noted that issuers no 

longer conducted on-campus solicitations at sporting events and other 

university functions, as they had in the past. Two organizations told us 

they believed the decline in marketing of college student credit cards 

began by the early or mid-2000s, while three others said it began around 

2009, when the CARD Act was enacted.

All the issuers told us that as of 2013, they did 

not rely on active marketing to students to solicit potential cardholders. 

Active marketing includes methods such as direct mail, telemarketing, or 

e-mail. Instead, interested students could learn about the cards through 

issuer or third-party websites and bank branch offices.

According to annual surveys of college students conducted by Student 

Monitor, a market research firm specializing in the college student market, 

the number of students obtaining a credit card in response to a solicitation 

through direct mail or on campus has dropped significantly in recent 

years.21

 19An organization that is recognized as tax exempt may still be liable for tax on its 

unrelated business income, which is income from an activity that is not substantially 

related to the educational, charitable, or other purpose that is the basis of the 

organization’s exemption.

The proportion of students reporting that they obtained a credit 

20The Nilson Report. Because we did not identify an aggregate data source specifically for 

college student credit cards, it is not known what proportion of that market these issuers 

represent. In addition, representatives of one of the five issuers told us they did not 

consider their card to be a college student credit card, but we counted it as such because 

the card was expressly labeled and marketed as being for college students. 

21Since 1996, Student Monitor annually has issued a report on student financial services 

based on in-person, on-campus interviews of 1,200 undergraduate students enrolled fulltime at 100 4-year colleges and universities throughout the United States. According to 

Student Monitor, the 2013 study had a 2.4 percent margin of error with a 95 percent 

confidence interval.

Marketing of Credit Cards 

Specifically to Students 

Has Declined, According 

to Issuers and Survey 

Data
Page 19 GAO-14-225 College Credit Cards

card as a result of a direct mail solicitation declined from 36 percent in 

2000 to 6 percent in 2013 (see fig. 5).22

 22We reported the 2000 data from Student Monitor in 

In 2013, students reported 

receiving significantly fewer mail (1.6) and e-mail solicitations (1.4) in a 

typical month than respondents in 2007 (5.6 and 9.1, respectively). Two 

issuers told us the decline in direct mail resulted in part from restrictions 

in the CARD Act on prescreened credit offers to those under 21. In 2013, 

fewer than 1 percent of students obtained their credit card as a result of 

an on-campus display or a company representative on campus (a 

practice known as tabling), as compared with 15 percent and 6 percent, 

respectively, in 2000. Two issuers told us they still used on-campus 

marketing but that they focused on their other financial products, such as 

checking accounts, and no longer accepted credit card applications at oncampus events.

GAO-01-773, p. 19.
Page 20 GAO-14-225 College Credit Cards

Figure 5: Percentage of Students Obtaining Their Credit Cards, by Method of 

Solicitation, 2000 and 2013

a

Data not available for 2000.

b

Tabling refers to staffing tables at a campus location to market credit cards to students.

According to Student Monitor, more students have been acquiring their 

credit cards by initiating contact with the card issuer. For example, in 

2013, 48 percent of students receiving a credit card applied in person at a 

bank (often the one with which they already had a deposit account), 

compared with 14 percent in 2000. Twenty-four percent received a card 

by initiating contact through the Internet or by telephone, compared with 

approximately 8 percent in 2000.
Page 21 GAO-14-225 College Credit Cards

Data are not available to definitively determine the effect that affinity 

cards and college student cards have had on student credit card debt. 

The effect of affinity cards may be limited because, as seen earlier, fewer 

students appear to hold these cards. The effect of college student cards 

is difficult to determine because the available data cover credit cards in 

general rather than college student cards in particular. However, students’

overall use of credit cards appears to have declined in recent years.

Publicly available data do not allow a clear determination of the impact of 

college affinity and college student cards on student credit card debt. One 

limiting factor is that card issuers do not always ask on applications or 

know which of their cardholders are students. Additionally, while some 

data exist about the age of credit cardholders, age is not a reliable proxy 

for student status, especially as the age of college students has increased 

in recent years.23 Multiple studies have examined the factors influencing 

credit card use among students, but none that we identified focused 

specifically on the impact of college affinity or college student credit cards 

on student debt. For example, a 2012 study that examined the effect of 

the CARD Act reviewed affinity card agreements and surveyed college 

students on their use of credit cards, but it did not seek to determine the 

impact of particular types of credit cards.24

The effect of affinity cards on student credit card debt may be limited 

because fewer students appear to hold these cards, which generally have 

not been marketed specifically to college students since at least 2009.

Representatives of two organizations with affinity cards estimated that 1 

percent or less of their current cardholders were students, while a third 

organization estimated that 3 percent were students. The proportion of 

affinity cards held by students appears to have declined since the cards’

Similarly, surveys on student 

credit card use by Sallie Mae (a financial services company specializing 

in education) and Student Monitor, discussed later in this report, asked 

respondents about general credit card use but not specifically about 

affinity or college student credit cards.

 23For example, the percentage of students at degree-granting institutions of higher 

education who were age 25 or older was 43 percent in 2010. GAO analysis of Department 

of Education, National Center for Education Statistics, NCES 2012-001, Digest of 

Education Statistics, 2011. 

24Jim Hawkins, “The CARD Act on Campus,” Washington and Lee Law Review, vol. 69, 

no. 3 (2012).

Effect of College 

Affinity and Student 

Cards on Student 

Credit Card Debt 

Largely Is Unknown

Limited Information 

Available on Effects of 

College Affinity and 

Student Credit Cards on 

Card Debt

College Affinity Cards
Page 22 GAO-14-225 College Credit Cards

introduction. For example, one organization estimated that in the past, up 

to 15 percent of its cardholders were students, but that virtually none 

were at present.

However, the exact prevalence of students holding affinity credit cards is 

not known. While the CARD Act requires issuers to submit information on 

college affinity card programs, including the number of cardholders, to 

CFPB, issuers are not required to report on the number of student 

cardholders. Three affinity card issuers with whom we spoke said that 

they could not identify which cardholders were students, or they 

considered cardholder information proprietary and therefore declined to 

share the information.

We did not identify data that would allow a determination of the effect of 

college student credit cards in particular—as distinct from credit cards in 

general—on student credit card debt. Representatives of CFPB, 

researchers, and organizations that have studied credit card use told us 

that they were not aware of research or data sets specific to college 

student credit cards. While banks file quarterly reports with regulators that 

contain information on the banks’ credit card portfolios, these reports do 

not differentiate by type of card.25 Similarly, The Nilson Report, an 

industry trade journal that reports on credit cards, has not issued a report 

specific to student credit cards in more than 10 years. Four issuers of 

college student credit cards told us they were unable to share specific 

information on these cards or the student holders of their other credit 

cards because the information was not available or they considered such 

information proprietary.26

 25Insured commercial banks must submit to their federal regulators (quarterly) a 

Consolidated Report of Condition and Income, known as a Call Report, which includes a 

comprehensive balance sheet and income statement, including income generated by 

credit card portfolios.

Even if comprehensive data on college student 

credit cards existed, the data’s value for understanding student credit 

card debt would be limited because many cardholders could continue to 

use their student cards after they ceased being students.

26CFPB has access to de-identified, account-level information from some issuers; those 

data are housed with a third-party contractor that provides data warehousing and analytics 

in the credit card market. However, according to CFPB staff, while some credit card 

issuers indicate accounts that are student credit cards, comprehensive information 

specifically on student cardholders is not available. We have ongoing work related to 

CFPB’s data collection and its privacy and security procedures.

College Student Credit Cards
Page 23 GAO-14-225 College Credit Cards

While data specific to college affinity and college student credit cards are 

limited, available evidence suggests college students’ use of credit cards 

overall has declined in recent years. Annual surveys of college students 

conducted by Sallie Mae and Student Monitor represent two primary 

sources of information on student credit card use.27

The two studies suggest that the number of students owning credit cards 

declined in recent years. Student Monitor found that the proportion of 

college students holding credit cards declined from 53 percent in 2004 to 

33 percent in 2013.28 Sallie Mae reported the proportion of students 

owning credit cards decreased from 49 percent in 2010 (the first year it 

began collecting this information) to 29 percent in 2013 (see fig. 6).29

 27Sallie Mae’s annual study, which has produced information on college students’ credit 

card use since 2010, uses telephone interviews of a sample of undergraduate students 

who are 18–24 years old and an unrelated sample of parents of such students. Eight 

hundred students were interviewed for the 2013 study. The Student Monitor study uses inperson, on-campus interviews of 1,200 college students enrolled full-time at 100 four-year 

colleges and universities throughout the United States. The firm’s Financial Services

report has included information on student credit card use since 1996. Because the 

surveys are based on self-reporting of payment behaviors and estimated credit card debt 

levels, they may be prone to biases and not accurately represent actual behaviors and 

debt levels. The surveys were not designed to verify that information. Some researchers 

maintain that respondents sometimes underreport the quantity or level of characteristics 

that could be considered unflattering, such as the amount of outstanding credit card debt.

In 

the Student Monitor study, 72 percent of students who had a credit card 

in their own name in 2013 owned a single card, 21 percent had two credit 

cards, and 8 percent had three or more credit cards.

28Student Monitor, Financial Services – Spring 2013 (Ridgewood, N.J.: June 2013). 

Overall credit card ownership includes cards the students own and those for which they 

have permission to use (typically, parents’ cards). The number of students who had a 

credit card in their name similarly declined—from 46 percent in 2004 to 26 percent in 

2013. 

29Sallie Mae and Ipsos Public Affairs, How America Pays for College 2013: Sallie Mae’s 

National Study of College Students and Parents (Newark, Del.: 2013) and Sallie Mae, 

How America Pays for College 2010: Sallie Mae’s National Study of College Students and 

Parents Conducted by Gallup (Reston, Va.: 2010). 

Students’ Overall Use of 

Credit Cards Appears to 

Have Declined

Number of Students with Credit 

Cards
Page 24 GAO-14-225 College Credit Cards

Figure 6: Percent of Students Who Reported Owning a Credit Card, 2010-2013

CFPB and the Federal Reserve Bank of Richmond similarly reported a 

decline in credit card ownership among younger consumers. In a 2013 

CFPB survey of major credit card issuers, new cards issued to those 

under 21 dropped from 3.9 million in 2007 to 1.7 million in 2012 (a 56 

percent reduction). The percentage of consumers ages 18-20 who 

opened a credit card account dropped from 33.6 percent to 14.4 percent 

during that period.30

 30Consumer Financial Protection Bureau, CARD Act Report: A Review of the Impact of 

the CARD Act on the Consumer Credit Card Market (Washington D.C.: Oct. 1, 2013). The 

reported numbers are based on an inquiry conducted by the CFPB Office of Supervision 

gathering information from a number of large banks on their credit card and CARD Act 

compliance practices. The issuers that participated in this inquiry represented 

approximately 80 percent of credit card industry balances. 

The study by the Federal Reserve Bank of Richmond 

analyzed consumer credit data and found that individuals under 21 were 
Page 25 GAO-14-225 College Credit Cards

8 percentage points less likely to have a credit card after the CARD Act 

than before it became law in 2009.31

At the same time, students who get credit cards in their own names—that 

is, the students receive the bill and are responsible for payment—

increasingly have been doing so before starting college. According to 

Student Monitor, 56 percent of students in 2013 obtained their first credit 

card before starting college—29 percent in high school or earlier, and 27 

percent between high school and college (see fig. 7).32

 31The data in the analysis were from the New York Federal Reserve Bank Consumer 

Credit Panel/Equifax. The Consumer Credit Panel contains detailed records of individual 

debt and borrowing on a quarterly basis from the first quarter of 1999 to the most recent 

quarter. The study looked at data from 2005-2008 for individuals between 18 and 25 years 

old. Peter Debbaut, Andra Ghent, and Marianna Kudlyak, Are Young Borrowers Bad 

Borrowers? Evidence from the Credit CARD Act of 2009 (Richmond, Va.: July 11, 2013).

In contrast, in 

2000, students were more likely to get their first credit card when they 

already were in college.

32See Student Monitor, 2013.
Page 26 GAO-14-225 College Credit Cards

Figure 7: Time Period of Credit Card Acquisition for Students with Credit Cards, 

2000 and 2013

Note: The data above include only those credit cards for which the student is responsible for 

payment.

While students’ use of credit cards appears to have declined, their use of 

debit cards has increased. According to Student Monitor, 63 percent of 

students had a debit card in 2013, as compared with 59 percent in 2008 

and 51 percent in 2000. Representatives of the financial industry and a 

researcher told us that the recent financial crisis has made many students 

and younger people more wary of credit and thus more disposed to using 

prepaid and debit cards. Student Monitor found that 62 percent of 

students interviewed in 2013 said they feared getting into credit card debt.

Forty-five percent of all students with a credit card in their name charged 

$100 or less each month in 2013, according to Student Monitor. Fifty-nine 

percent used their card fewer than six times a month, including 8 percent 

who indicated that they did not usually use their credit card each month.

On average, students charged $171 monthly, a decrease of 8 percent 

from 2012. 

Charges and Balances
Page 27 GAO-14-225 College Credit Cards

Sallie Mae reported that students’ median reported balance for all 

cardholders was $179 in 2013, as compared with $289 in 2011. The 

survey also found that 2 percent of all students in 2013 with a credit card 

had a combined outstanding balance of more than $4,000, while 29 

percent had a zero balance. Student Monitor found that the 28 percent of 

respondents who carried a balance had a median outstanding balance of 

$136.

Credit limits for credit cards owned by students usually are lower than 

those for the general population and have been decreasing. In 2010, the 

median credit limit for all bank-type general credit cards was $15,000.33

Several studies provide information on college students’ payment 

patterns for credit cards:

In 

contrast, Student Monitor found that more than 60 percent of credit cards 

owned by students had credit limits of $500 or less, and 80 percent were 

$1,000 or less. In 2000, 27 percent of respondents had credit limits of 

$1,000 or less, and 11 percent had limits of at least $5,000. However, 

because students may have multiple credit cards, their total credit card 

debt can be higher than the credit limit of any one card.

• Payment amount. Student Monitor found that 72 percent of students 

reported paying their outstanding charges in full each month in 2013.

Sallie Mae found that 52 percent of student respondents in 2013 paid 

in full each month in the previous year, and that 10 percent of 

students typically made only the minimum payment.34

• Parental responsibility. The Student Monitor and Sallie Mae studies 

found that the college student, rather than the parent, was most often 

responsible for making credit card payments (79 percent in the 

Student Monitor study and 92 percent in the Sallie Mae study).

• Late payment fees. One quarter of students in the 2013 Student 

Monitor study reported paying a late payment fee at least once since 

 33Jesse Bricker, Arthur B. Kennickell, Kevin B. Moore, and John Sabelhaus, “Changes in 

U.S. Family Finances from 2007 to 2010: Evidence from the Survey of Consumer 

Finances,” Federal Reserve Bulletin, vol. 98, no. 2 (June 2012). Additionally, three issuers 

of college student credit cards told us that those cards’ credit limits were typically lower 

than those of general credit cards. 

34Student Monitor asked respondents whether they typically carried a balance or paid the 

card in full each month for four different credit card types and combined the responses. 

Sallie Mae asked respondents to describe their typical credit card payment behavior. 

Credit Limits

Payment and Delinquency 

Patterns
Page 28 GAO-14-225 College Credit Cards

acquiring a credit card, with almost half of that group incurring more 

than one late fee.

• Delinquent payment. Cardholders under 21 were more likely to 

experience minor delinquencies (30 or 60 days past due) than older 

cardholders, according to the Federal Reserve Bank of Richmond 

study.35 At the same time, young cardholders were substantially less 

likely to experience serious delinquency (90 days past due and 

longer). The study also found that cardholders who got their credit 

cards earlier in life were less likely to experience a serious default 

later in life.

We provided a draft of this report to CFPB and the Federal Reserve. We 

incorporated technical comments from these agencies as appropriate.

We are sending copies of this report to the appropriate congressional 

committees, CFPB, the Federal Reserve, and other interested parties. In 

addition, the report will be available at no charge on our website at 

http://www.gao.gov.

If you or your staff have any questions about this report, please contact 

me at (202) 512-8678 or cackleya@gao.gov. Contact points for our 

Offices of Congressional Relations and Public Affairs may be found on 

the last page of this report. GAO staff who made key contributions to this 

report are listed in appendix II.

Alicia Puente Cackley

Director, Financial Markets and Community Investment

 35Debbaut, et al.

Agency Comments
Appendix I: Objectives, Scope, and 

Methodology

Page 29 GAO-14-225 College Credit Cards

This report examines (1) the trends associated with and characteristics of 

college affinity card agreements, (2) the extent of marketing for college 

affinity and college student credit cards, and (3) what is known about the 

effect of the use of affinity cards and student credit cards on student 

credit card debt. We use “college affinity card” to refer to a credit card 

issued in conjunction with an agreement between a credit card issuer and 

an institution of higher education or an affiliated organization (such as an 

alumni association or foundation). We use “college student credit card” to 

refer to a credit card established for and targeted to college students.

To identify the trends and general characteristics associated with college 

affinity card agreements, we reviewed the 2010 and 2011 Report to the 

Congress on College Credit Card Agreements, which the Board of 

Governors of the Federal Reserve System (Federal Reserve) issued, and 

the 2012 and 2013 College Credit Card Agreements: Annual Report to 

Congress, which the Bureau of Consumer Financial Protection (also 

known as the Consumer Financial Protection Bureau or CFPB) issued.1

These reports provide summary information, such as the total number of 

agreements in effect and number of accounts open at the end of the

year.2

To determine the characteristics of the agreements, we first reviewed and 

analyzed affinity card agreements between issuers and schools or 

affiliated organizations from calendar years 2009-2012. We downloaded 

information for all those agreements in effect during those years from 

public databases managed by the Federal Reserve and CFPB.3

 1

The Credit Card Accountability Responsibility and Disclosure Act of 2009 required 

issuers to submit annually to the Federal Reserve the terms and conditions of any college 

credit card agreement in effect between the issuer and an institution of higher education at 

any time during the preceding calendar year, along with certain summary information 

about the agreements. Pub. L. No. 111-24, § 305(a),123 Stat. 1734, 1750; 12 C.F.R. § 

1026.57(d). This responsibility transferred from the Federal Reserve to CFPB in 2011. 

Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 

Stat. 1376 (2010).

We 

2

For our review, we classified agreements that had been recorded as being with alumni 

associations or alumni under “alumni associations.” We used “other” to include 

agreements with fraternities, sororities, professional or trade organizations, and those with 

multiple organizations, such as a university and an alumni association.

3

The database can be accessed at http://data.consumerfinance.gov/Government/CollegeCredit-Card-Agreements/r963-hvsf. We downloaded the data on December 4, 2012. As of 

December 2, 2013, the 2011 data remained the most current available.

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 30 GAO-14-225 College Credit Cards

analyzed the agreements to identify general trends and characteristics. 

We assessed these data by interviewing Federal Reserve and CFPB staff 

knowledgeable about the data and checking the data for illogical values 

or obvious errors. We found the data to be sufficiently reliable for 

describing the general characteristics and trends of the affinity card 

marketplace.

Because we were most interested in current agreements, we focused our 

analysis on the agreements from 2011, the most recent year for which 

information was available. Twenty providers issued these agreements.4

For a more thorough analysis, we selected a nonprobability sample of 39 

agreements from 574 agreements identified as being in effect as of 

January 1, 2012.5 We determined the sample by applying three criteria to 

the agreements. First, we included the 25 largest agreements overall, as 

measured by the number of cardholders. Second, we included the largest 

agreement from each issuer that provided affinity credit cards.6

 4 We combined two companies listed in the database—Capital One Bank (USA), N.A. and 

Capital One, N.A.—because they are both subsidiaries of Capital One Financial 

Corporation. 

Third, we 

included the five largest agreements with institutions of higher education, 

as measured by the number of cardholders under those agreements. 

These numbers do not add to 39 because agreements could meet criteria 

for inclusion under more than one category. We selected these criteria 

because we wanted to capture a large proportion of affinity cardholders 

as well as any potential variation among issuers or organizational type. 

We included the five largest institutions of higher education because we 

anticipated that those agreements could be more likely to include 

students as cardholders, a topic of specific interest. See table 8 for the list 

of reviewed agreements.

5

Results from nonprobability samples cannot be used to make inferences about a 

population, because in a nonprobability sample some elements of a population being 

studied have no chance or an unknown chance of being selected as part of the sample. 

We selected our sample from the 574 agreements that were still in effect as of January 1, 

2012, instead of the broader set of 798 filed agreements in 2011, because we were most 

interested in current agreements.

6

We excluded from our sample agreements with Elevations Credit Union, Pennsylvania 

State Employees Credit Union, and USC Credit Union because they did not contain credit 

card products, and we excluded agreements with Compass Bank because they were not 

with organizations associated with higher education, and therefore were outside the scope 

of our review. 
Appendix I: Objectives, Scope, and 

Methodology

Page 31 GAO-14-225 College Credit Cards

Table 8: 2011 College Credit Card Agreements Selected for Review, by Institution Type, Issuer, and Size Categories 

Institution or organization

Type of institution or 

organization

Credit card 

issuer

Largest 25 

agreements, by 

number of 

cardholders 

Largest

agreement for 

issuer, by 

number of 

cardholders

Largest five

agreements with

universities, by 

number of 

cardholders

Penn State Alumni Association Alumni association FIA Card 

Services, N.A.a Yes Yes No

Golden Key International Honour 

Society

Other FIA Card 

Services, N.A.

Yes No No

Alumni Association of the 

University of Michigan

Alumni association FIA Card 

Services, N.A.

Yes No No

Association of Former Students 

of Texas AM University

Alumni association FIA Card 

Services, N.A.

Yes No No

The Ex-Students Association of 

the University of Texas

Alumni association FIA Card 

Services, N.A.

Yes No No

Indiana University Alumni 

Association

Alumni association FIA Card 

Services, N.A.

Yes No No

UCLA Alumni Association Alumni association FIA Card 

Services, N.A.

Yes No No

Wisconsin Alumni Association Alumni association FIA Card 

Services, N.A.

Yes No No

University of Southern California University FIA Card 

Services, N.A.

Yes No Yes

The University of Georgia 

Foundation

Foundation FIA Card 

Services, N.A.

Yes No No

California Alumni Association Alumni association FIA Card 

Services, N.A.

Yes No No

General Alumni Association of 

University of North Carolina at 

Chapel Hill

Alumni association FIA Card 

Services, N.A.

Yes No No

Purdue Alumni Association Alumni association Purdue 

Federal Credit 

Union

Yes Yes No

University of Puerto Rico University Banco Popular 

de Puerto Rico

Yes Yes Yes

State University of Iowa Alumni 

Association

Alumni association FIA Card 

Services, N.A.

Yes No No

The Ohio State University Alumni 

Association, Inc.

Alumni association FIA Card 

Services, N.A.

Yes No No

Stanford Alumni Association Alumni association FIA Card 

Services, N.A.

Yes No No

Phi Theta Kappa International 

Honor Society

Other FIA Card 

Services, N.A.

Yes No No
Appendix I: Objectives, Scope, and 

Methodology

Page 32 GAO-14-225 College Credit Cards

Institution or organization

Type of institution or 

organization

Credit card 

issuer

Largest 25 

agreements, by 

number of 

cardholders 

Largest

agreement for 

issuer, by 

number of 

cardholders

Largest five

agreements with

universities, by 

number of 

cardholders

Auburn Spirit Foundation Foundation FIA Card 

Services, N.A.

Yes No No

Iowa State University Alumni 

Association

Alumni association FIA Card 

Services, N.A.

Yes No No

National Alumni Association of 

the University of Alabama

Alumni association FIA Card 

Services, N.A.

Yes No No

Clemson University, Inc. Alumni association FIA Card 

Services, N.A.

Yes No No

University of Arizona Alumni 

Association

Alumni association FIA Card 

Services, N.A.

Yes No No

Kansas State University Alumni 

Association

Alumni INTRUST 

Bank, N.A.

Yes Yes No

Trustees of the University of 

Pennsylvania

University FIA Card 

Services, N.A.

Yes No Yes

Virginia Tech Alumni Association Alumni association Chase Bank 

USA, N.A.

No Yes No

Harvard Alumni Association Alumni association Barclays Bank 

Delaware

No Yes No

Boston University Alumni association U.S. Bank 

National 

Association ND

No Yes No

University of Illinois Alumni 

Association

Alumni association University of 

Illinois 

Employees 

Credit Union

No Yes No

Western Michigan Alumni 

Association

Alumni association PNC Bank, 

National 

Association

No Yes No

Michigan State University University Michigan State 

University 

Federal Credit 

Union

No Yes No

Georgia Tech Alumni Association Alumni association Capital One, 

N.A.

No Yes No

Association of Graduates of the 

United States Air Force Academy

Alumni association USAA Savings 

Bank

No Yes No

Boston College University GE Money 

Bank

No Yes No

The Principia Alumni association UMB Bank, 

N.A.

No Yes No

Coastal Carolina University University Carolina Trust 

FCU

No Yes No
Appendix I: Objectives, Scope, and 

Methodology

Page 33 GAO-14-225 College Credit Cards

Institution or organization

Type of institution or 

organization

Credit card 

issuer

Largest 25 

agreements, by 

number of 

cardholders 

Largest

agreement for 

issuer, by 

number of 

cardholders

Largest five

agreements with

universities, by 

number of 

cardholders

University of West Florida 

Foundation Inc

Foundation Pen Air 

Federal Credit 

Union

No Yes No

The Trustees of Columbia 

University

University FIA Card 

Services, N.A.

No No Yes

St Johns University New York University FIA Card 

Services, N.A.

No No Yes

Total 25 16 5

Source: GAO analysis of CFPB data.

a

FIA Card Services, N.A. is a subsidiary of Bank of America.

Collectively, the agreements included in our sample covered about 38 

percent of all cardholders in 2011. Twenty-six of the reviewed 

agreements were with alumni associations, 8 were with institutions of 

higher education, 3 were with foundations, and 2 were with other 

organizations.

We reviewed these agreements and collected information using a data 

collection instrument (DCI) to gather characteristics such as their effective 

date, duration, allowed marketing practices and target populations, 

payments to the organization, consumer protections, and service 

standards. Findings from this limited review of 39 agreements cannot be 

generalized to the overall population of agreements in 2011.

We developed the DCI after reviewing some of the 2011 agreements, 

focusing on items such as the scope, consumer protections, marketing 

practices, payments, terms, and fees. We converted the DCI to a pdf 

format for direct data entry. Three team members entered information on 

two agreements each using the DCI and discussed their experiences. We 

revised some questions for clarity and deleted others to avoid duplication. 

This version of the DCI was reviewed by a GAO survey specialist and an 

expert who surveyed students regarding their credit card use and 

conducted a similar review of the credit card agreements, and we 

incorporated minor changes. We further clarified that the review of 

agreements would focus on the most recent full agreement or 

amendment and those items that were still in effect as of January 1, 2012.

Two team members then entered information about the agreements into 

the DCI. We verified our coding by comparing the original coder’s DCI 

responses with those of the second coder. For each comparison set, we 
Appendix I: Objectives, Scope, and 

Methodology

Page 34 GAO-14-225 College Credit Cards

compared the coding for 59 data elements and found discrepancies in 

fewer than 10 percent of the entries. This was determined to ensure a 

base level of reliability in the information collected. While the results of 

our review of the 39 agreements cannot be projected nationwide, they 

provide context and information related to the contents of the 39 

agreements.

To address the second and third objectives, we reviewed documents and 

interviewed representatives of credit card issuers, organizations and 

schools with affinity card agreements, and federal agencies, as well as 

academics and other individuals who have studied credit cards and their 

use by students. We reviewed studies—such as those by Sallie Mae (a 

financial services company specializing in education), Student Monitor (a 

market research firm that specializes in the college student market), and 

U.S. Public Interest Research Group (a consumer advocacy 

organization)—on student credit card use. We identified these studies 

through the Econ Lit database and general Internet searches using terms 

such as “college credit cards.” We focused on several years of Sallie 

Mae’s How America Pays for College studies and on Student Monitor’s 

Financial Services – Spring 2013 report, as well as recent reports by 

CFPB and the Federal Reserve Bank of Richmond.7

 7

Sallie Mae’s annual study, which has produced information on college students’ credit 

card use since 2010, uses telephone interviews of a sample of undergraduate students 

18–24 years old and an unrelated sample of parents of such students. Eight hundred 

students were interviewed for the 2013 study. The Student Monitor study uses in-person, 

on-campus interviews of 1,200 college students enrolled full-time at 100 colleges and 

universities throughout the United States. The firm’s Financial Services report has 

included information on student credit card use since 1996.

We assessed the

quality of the survey data by interviewing Student Monitor and Sallie Mae 

officials knowledgeable about the data and checked the data for illogical 

values or obvious errors. We found the data to be of sufficient quality and 

reliability for providing general information on student credit card use. 

According to the Student Monitor, the estimates from the 2013 study had 

a 2.4 percent margin of error at the 95 percent confidence level. Because 

surveys are based on self-reporting of payment behaviors and estimated 

credit card debt levels, they may be prone to biases and not accurately 

represent actual behaviors and debt levels. The surveys were not 

designed to verify that information. Some researchers maintain that 

respondents sometimes underreport the quantity or level of 

characteristics that could be considered unflattering, such as the amount 

of outstanding credit card debt. We also reviewed marketing materials 
Appendix I: Objectives, Scope, and 

Methodology

Page 35 GAO-14-225 College Credit Cards

issuers used to market the cards. Lastly, we reviewed provisions of the 

Credit Card Accountability Responsibility and Disclosure Act of 2009 

related to affinity credit cards and credit card use by those under 21.8

We interviewed representatives of four issuers of affinity credit cards—

Bank of America (FIA Services), Capital One, Chase, and U.S. Bank—

that had 91 percent of such cardholders in 2012. We also interviewed 

representatives of the five largest general credit card issuers, measured 

by 2011 portfolio size, as reported by The Nilson Report.

9

We also interviewed representatives of six organizations and schools to 

discuss their affinity credit card relationships—the Association of Former 

Students of Texas A&M University, Boston University Alumni Association, 

Georgia Tech Alumni Association, Golden Key International Honour 

Society, Penn State Alumni Association, and Washington University. 

These six organizations were chosen because they had among the 

largest number of affinity cards (as determined by number of 

cardholders), had cards from the three affinity card issuers with the most 

agreements, and included one organization (Washington University) that 

had previously chosen to end its affinity agreement. To get a broader 

perspective, we also interviewed representatives of the National 

Association of College and University Business Officers.

We discussed 

with these issuers—American Express, Bank of America (FIA Services), 

Chase, Citibank, and Wells Fargo—any student credit cards currently or 

previously issued. To get a broader perspective on the use of these cards 

by financial institutions, we also interviewed representatives of three 

industry trade groups—the American Bankers Association, the Consumer 

Bankers Association, and the Credit Union National Association.

In addition, we interviewed representatives of CFPB, the Department of 

Education, the Federal Reserve, and the Office of the Comptroller of the 

Currency to discuss their oversight of affinity and student credit cards and 

trends they have observed in the industry. We talked with two academics 

who have studied and written about student credit card use, as well as 

representatives of Sallie Mae, Student Monitor, and the U.S. Public 

Interest Research Group.

 8

Pub. L. No. 111-24, §§ 301-305, 123 Stat. 1734,1747-51.

9

The Nilson Report is a twice-monthly trade journal that provides information on 

companies, products, and services from the payments industry. 
Appendix I: Objectives, Scope, and 

Methodology

Page 36 GAO-14-225 College Credit Cards

We conducted this performance audit from December 2012 to February 

2014 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.
Appendix II: GAO Contact and Staff 

Acknowledgments

Page 37 GAO-14-225 College Credit Cards

Alicia Puente Cackley, (202) 512-8678 or cackleya@gao.gov

In addition to the contact named above, individuals making key 

contributions to this report were Jason Bromberg, Assistant Director; Amy 

Anderson; Kevin Averyt; Daniel Newman; Christopher H. Schmitt; and 

Michelle St. Pierre. In addition, key support was provided by Bethany M. 

Benitez; Kenneth Bombara; William Chatlos; Barbara Roesmann; and 

Jena Sinkfield.

Appendix II: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(250725)
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