By Ryan May
I recently switched banks; not because of lack of service, but because of cost. For a few dollars a month my former bank lost me as a potential lifetime client, and all the business that I would have brought them: credit cards, car loans, mortgages, investments, and retirement savings.
Financial institutions’ treatment of students does not make sense. Alienating people who will one day have higher average incomes and need somewhere to keep their earnings – and borrow money – is not good business sense.
Most banks make something of an effort by lowering fees for students or waiving them all together if a minimum monthly balance is maintained. Unfortunately, both put another burden on the students’ already overtaxed finances. Yearly service fees can total over $40, and maintaining a minimum balance is not an option for the many students.
After settling on an acceptable banking solution, I went to the nearest branch of the lucky institution, and was forced to wait for over half an hour before being lead into a crowded cubicle to open my new account. I doubt that the same thing would have happened if I had arrived with a briefcase.
Again banks’ poor opinion of students showed, but some institutions like the Royal Bank are making an effort. Royal has a small branch in the lower level of Mac Hall to help students with opening accounts and managing their finances. Royal also offers students a free Student Price Card for opening a new account, but charges students $3.50 a month for a chequing account regardless of the balance. More institutions should open branches on campus to attract students’ business and make it easier to manage money, but not if they are going to charge $3.50 a month to take your money.
After filling out forms and being pressured to open a savings account, I had my new account, but had yet to be offered the other product that I had come in hoping to apply for: a credit card. Credit cards benefit students by allowing them to defer payment for items by up to seven weeks at no charge, and allowing them to build a good credit record for future loans applications. Credit cards benefit banks by increasing the amount of business that they process for their clients. Yet I had to ask for a credit card application, and was disappointed to discover that they did not offer a student card. After over an hour I finally left the branch only somewhat satisfied: I had what I went in for, but it had taken much too long.
If banks want to continue to attract student business and build a client base post-secondary graduates they must improve their treatment of students and decrease the costs students incur while doing business with them. In the long run, both sides will benefit.