One of the survey findings released by the Federal Reserve last week clearly indicates that there has been a 17% drop in the rate of cards issued to students through alumni associations and universities. According to consumer advocates, this steep fall is the result of the Credit Card Accountability, Responsibility and Disclosure Act of 2009 that stipulates that credit card lenders cannot entice students with freebies and other rewards just to sign up for credit cards.

The survey findings also reveal that the marketing agreements also went down by 41 and stood at 1,004 which is 4% down compared to 2009. As per the stipulations of the CARD Act, lenders cannot issue credit cards to students below the age of 21 unless they have a co-signer on the form or they can produce sufficient proof of income to cover their credit card debts.

The report of the Federal Reserve also shows that the cards issued by colleges, universities and alumni associations that stood at a little over 2 million in the year 2009 dropped to 1.7 million in 2010. The marketing agreements brought in revenue of $73.3 million to colleges in 2010 as compared to $84.5 million the year before. Some of the colleges and universities that led the pack in terms of college affinity cards were University of Southern California, University of Texas, Penn State and University of Michigan.

National Association of State Public Interest Research Groups’ director, Ed Mierzwinski, said that the stipulations of the CARD Act brought about transparency and has caused the colleges to move away from marketing agreements with the banks which has proved beneficial to students.