Trenton – Legislation sponsored by Senate Higher Education Chair Senator Sandra Bolden Cunningham and Senator M. Teresa Ruiz, which aims to protect college students from unnecessary bank fees, cleared the Senate today.
“The CFPB report made it clear that these types of agreements, where banks are paying colleges to be able to market certain products directly to students, are not in the best interest of the students,” said Senator Cunningham (D-Hudson). “Especially if the current administration is not going to take action at the federal level, it is our responsibility to protect New Jersey students from these predatory tactics.”
The bill, S-804, would ban arrangements wherein institutions of higher education receive compensation from a financial institution in exchange for certain privileges, including the ability to access student data and market directly to students.
“Colleges should not be profiting off of contracts that actively hurt students,” said Senator Ruiz (D-Essex). “This legislation will ensure that all partnerships between financial institutions and our universities are in the best interest of the students and work toward saving them money.”
The bill comes out of a 2018 Consumer Financial Protection Bureau report which found that at colleges where banks pay schools to promote accounts, students pay up to three times more on average in fees.
The bill was released from the Senate by a vote of 38-0.