"When used properly, credit cards can be a great financial tool," said the bill co-sponsor, Assemblywoman Sandra Love, D-Camden. "Unfortunately, many college students do not understand how credit works and wind up getting themselves and their parents into financial trouble by spending more than they can possibly pay."
The bill would require credit card companies to register on campus before soliciting students. It would also mandate that they provide education on the responsible use of credit before issuing cards to students.
The bill would bar credit card companies from buying lists of students' names and addresses and from offering gifts in exchange for opening an account.
It also would bar companies from taking action against parents of students who fail to pay, unless the parent previously agreed to be responsible for the debt.
The legislative proposal cites a four-year-old study conducted by the national student loan company, Nellie Mae, which found more than half of the college students surveyed had four or more credit cards with an average total debt of $2,864.
"Casual, uninformed use of credit can have long-lasting financial implications," said co-sponsor Pam Lampitt, D-Camden. "Requiring credit card companies to ensure that college students understand how credit works before they apply for a credit card will go a long way toward making New Jersey undergraduates more savvy consumers."
Though some lawmakers expressed concern about how the educational component of the bill would be delivered - some asked whether could credit card solicitors would satisfy the requirement by giving students literature to take home and read, for example - the measure advanced by a vote of 3-1 with 1 abstention.
It now heads to the Assembly speaker for possible consideration by the entire Assembly. A similar bill awaits a hearing in the Senate Commerce Committee.
----
Click here for more New York and Tri-State News
