WASHINGTON (10/28/15)--The U.S. Department of Education announced final regulations Tuesday on college debit and prepaid cards. The rules would require institutions to make changes to how fees, including overdraft fees, are charged if a student selects an account offered directly or indirectly by contractors that assist institutions in making direct payments of federal student aid.
According to the Education Department, students will now be able to choose how to receive federal student aid refunds and be given information about financial aid disbursements options. It also will eliminate fees to access federal student aid.
The regulations also:
The final regulations come after attempts to draft a proposal through the Department of Education’s negotiated rulemaking authority. The authority allows an agency to invite members of interested groups to meetings where an attempt is made for consensus on the proposed rule. If it is successful, the agency may use those ideas as the basis for a proposed rule.
Working closely with CUNA during the process, Paul Kundert, president/CEO of UW CU, Madison, Wis., participated in that attempted rulemaking process, which took place last year.