Banks’ Student Love Affair Over

Financial institutions in the UK used to love students and would often go out of there way to sign them up. And why not? Students represent a fantastic opportunity for banks and credit card companies given their future earning potential and the fact most students tend to stay most their lives with the bank they had as a student. Banks used to spend millions in freebies trying to attract fickle students but are the days of student perks over?

The student financial market is seeing change, just like other areas of the economy. Freebies are disappearing as are added extras and favourable borrowing arrangements. Increasingly, you’d be lucky to be offered free cinema tickets along with your basic bank account – useful, eh? The credit crunch is hitting the student market just like others and the banks are seriously tightening their belts. No more iPods and cheap overdrafts. Sorry. There is of course another added risk for the bank which has shaken the very attractiveness of the student. With many students leaving university over £20,000 in debt and the credit crunch also harming the job market, there are worries that students may struggle to get those well paid jobs. This would put pressure on students’ ability to re-pay any bank debts and of course, this is something the banks worry about a great deal.

Whilst the situation might change, unfortunately it won’t in the short time. And remember, banks are also tightening their application criteria. You may be offered a reduced credit card and for many, the idea of a student credit card is out the window.

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