WASHINGTON (8/13/11)--Students who receive loan money transferred to debit cards should be aware of certain rights and options they have, according to an advisory issued by the Consumer Financial Protection Bureau.
Among its key points, the advisory:
- Notes that students cannot be required to use a specific bank or card and all federal loans must come with a paper check or cash option;
- Recommends that a student choose a financial institution before arriving at school; and
- Recommends a student sign up for direct deposit if offered.
The advisory was issued on Friday, two days after the Federal Deposit Insurance Corp.'s announcement that Higher One Holdings Inc. agreed to return about $11 million to college students for overcharging them for fees on its debit cards.
The bank is also paying a $110,000 civil fine and Bancorp Bank, which issued the OneAccount debit card administered by Higher One, is paying a $172,000 fine.
To see the advisory, use the resource link.