Student Credit Cards Interview with WINA Radio Charlottesville, VA
CreditCards.com Senior Industry Analyst Matt Schulz spoke on Thursday, August 27, 2015 with Les Sinclair of WINA Radio Charlottesville, VA about the August 2015 Student Credit Cards survey. The interview and transcript are below.
Les Sinclair: Matt, give us the story here. You guys at CreditCards.com have done a poll and it looks like student credit cards, not so bad?
Matt Schulz: Yeah, we looked at about a dozen popular student credit cards and what we found kind of surprised us because what you said was right – they do have kind of a reputation of having high interest rates and not a whole lot of rewards with them. But what we found was that today’s cards actually have pretty competitive interest rates compared to other cards and decent rewards and even come with some tools that help students handle their credit.
Sinclair: You said that you folks were even surprised. I think, when most consumers hear that, we’re thinking that credit card companies are money grubbing and they’re just looking out for getting the almighty dollar and it seems like these new kids who are spending mommy and daddy’s money – maybe – are prime target to run up some credit card debt, but it sounds like maybe that’s not the case?
Schulz: Well, college students are definitely an attractive group for banks because they see that those are the folks who are going to be running the companies and having the big careers and having pretty good salaries when they get older, but I think what we’re seeing is that it is such a competitive marketplace now that they have to give a little bit better offers, better terms in order to attract this age group of folks who generally are pretty credit-averse.
Sinclair: I was going to say that, they do seem credit-averse. What are some of these promotions that they’re offering that can get the kids to grab the cards?
Schulz: A few things. 1) None of the cards that we saw had annual fees, which is a good thing. We saw cards that have interest rates as low as about 11%, which is competitive for any credit card. But then we also saw stuff like one card would give you $100 sign-up bonus if you spent $500 in the first 90 days, and that’s not something that you typically saw in the past with student cards.
Sinclair: This is NewsRadio 1070 WINA. We’re talking with Matt Schulz who’s the Senior Industry Analyst for CreditCards.com. We’re talking about campus credit cards might be actually a good option for students. There is an advantage to getting a credit card when you’re young, at least one. Can you explain what those might be?
Schulz: The longer credit history you have over the course of time and the longer you’ve proven that you can do a good job with this, the better your credit score is going to be over time when in 15 years you might want to get a mortgage or a car loan or that sort of thing. So it can be good to get start a little early, but of course you just have to be ready and be prepared for all the responsibility that comes with having a credit card or you can get yourself into a lot of trouble.
Sinclair: Well, you mentioned the competitiveness, too, of credit cards. Who are the competitors out there? Because aren’t we really just talking about Visa, MasterCard, and American Express? Discover?
Schulz: No, we’re talking more about the banks themselves, like Citibank and Bank of America and Capital One and Wells Fargo and Discover and places like that. And a very small group of banks control a very large amount of the credit card market. And now that we’re seeing that people are feeling a little better about their finances and banks are willing to lend, it’s made this really competitive environment, making it a good time to look for cards.
Sinclair: Alright, well now that campuses and grounds here at the UVA are full of college students, might be a good time to check out the information. You guys do a pretty good job of digging into this, too. You want to tell folks where to go?
Schulz: Yeah, at CreditCards.com we’ve got hundreds of cards that are available and we also pride ourselves on having a lot of information that helps people make smart decisions about getting those cards and also what to do with them when they get them.
Sinclair: Alright, well we’ll put a link to this information as well as a link to CreditCards.com on the podcast of this. Matt Schulz with CreditCards.com. Thanks very much for being on, appreciate your time.
Schulz: Thanks for having me.