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United States : Governor Signs Buono Bill To Reform On-Campus Credit Card Solicitation
Publish Date : 25-Nov-2009
A bill sponsored by Senator Barbara Buono which would make various changes to regulate the solicitation of credit cards on college campuses – including requiring creditors to provide an educational program on the responsible use of credit and prohibiting credit card companies from using promotional gimmicks as an incentive for students to sign up – was signed into law today.
“Credit card debt is a growing problem amongst college students,” said Senator Buono, D-Middlesex, and Chairwoman of the Senate Budget and Appropriations Committee. “We need to be proactive in preparing our college students for the responsibility of personal credit. This new law ensures that students being solicited on campus in New Jersey will have the tools necessary to be better credit consumers.”
The law requires that credit card issuers annually register with an institution of higher education before soliciting students on-campus with credit card offers. The issuer is required to provide to students an educational program on responsible credit card use, which would include:
• A full explanation of the consequences of not paying off credit card balances in full within the time specified on the billing statement, including an explanation of how interest is computed on unpaid balances;
• A full explanation of the differences between an introductory interest rate and an ongoing interest rate, including the exact time when the higher ongoing interest rate takes effect;
• An explanation on how long it would take to pay off certain hypothetical balances by only paying the minimum monthly payment;
• An explanation on credit-related terms;
• And a discussion on the generally-accepted prudent uses of credit and the consequences of imprudent credit card use.
In addition, the law prohibits credit card solicitors from issuing a credit card to a student without a certificate that the student completed the credit education course. And finally, the law prohibits solicitors from purchasing or otherwise obtaining the names and addresses of enrolled students from the institution of higher education, or offering gifts or other promotional incentives to students in order to entice them to apply for a credit card.
