The CARD Act of 2009 has barely been in place for a month, but companies are already turning a profit with a variation on the theme…

• A company called Higher One has figured out how to make money on college students using plastic, despite recent regulations designed to keep credit card companies from preying on the under-21 population. And they’re not the only ones finding loopholes in the new regulations: PNC Bank has been encouraging schools to market PNC’s products to students on campus, since PNC is now barred from doing so itself.
• With the cooperation of school administrators, Higher One links student loan accounts to debit cards, allowing students to spend their financial aid funds anywhere with a single swipe. The cards are accepted anywhere MasterCard is, and they’re often branded with the school’s emblem.
• Though participating colleges say the card program makes accessing financial aid easier for students, many students are not convinced. The cards come with all sorts of fees, and the way the program is pushed by schools makes it look suspicious. Some schools use the cards as substitutes for student IDs, requiring everyone on campus to have one even if they don’t have a HigherOne account.

Facts & Figures

• The penalty for not using your Higher One debit card for 9 months is $19 per month.
• Other fees include $2.50 for ATM transactions with other banks and $0.50 per transaction made as “debit” (entering a PIN) rather than “credit” (signing a receipt).
• 675 colleges in the U.S. participate in Higher One’s debit card program.
• Higher One’s sales in the 3rd quarter of 2010 were $27 million.

“The [Higher One] Refund Card mailing may look like an unwanted credit card offer. PLEASE DO NOT DISCARD IT.” – From the website of the University of Maryland at Baltimore