Bank of America markets to alumni

Bank of America made a $17,000 deal with the GW Alumni Association, in hopes of increasing its customer base.

The payments represent a nationwide trend of credit card companies paying colleges and universities to promote their services, according to the report by the Federal Reserve.

Bank of America makes a contribution to the Alumni Association for every new account opened through GW and for every purchase made with the card, according to the Alumni Association’s website. The revenue Bank of America gives the Alumni Association goes toward supporting alumni grant programs, GW student scholarships and miscellaneous operating expenses, University spokeswoman Jill Sankey said.

The Credit Card Accountability Responsibility and Disclosure Act of 2009 – also known as the Credit CARD Act of 2009 – prohibits credit card companies from using incentives on campuses to get current students to sign up. It also requires companies to disclose how much they pay colleges to market to alumni, as well as how many new accounts the company nets from the marketing efforts.

Josh Frank, a senior research analyst at the Center of Responsible Lending, said there is no cap on how much money an institution can receive from a credit card company, as long as the money is reported.

Last year, credit card companies paid more than $83 million to universities to promote their services and opened more than 53,000 new accounts on college campuses.

Sankey said the partnership with Bank of America allows the Alumni Association to offer discounts and other benefits to members.

“These special offers are completely voluntary and provide the opportunity for the Alumni Association to reach out to the University’s graduates, show it is working on behalf of its constituents and prove there is value in staying connected with the GW community,” Sankey said.

Last year, credit card companies paid more than $83 million to universities to promote their services and opened more than 53,000 new accounts on college campuses.

Georgetown University’s Alumni Association was paid nearly $30,000 from the same company to open 112 new accounts, and American University was paid just over $21,000 for 30 new accounts, the report said.

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