Recently, I was asked about American university students’ top banking needs. Here are my thoughts on how we can get the #YOLO generation setup with the most essential financial tools. Feel free to add your Comments, below!
First, the fun stuff… Mobile apps!
Square Cash and PayPal are a couple must-have mobile offerings for students, friends, and family, especially since 65% of American households are now smartphone users. These mobile apps are both easy to use and widely distributed, meaning students can save trips to the bank and ATM, reducing risks of lost cash and cutting transportation costs. Parents take note: these may provide great ways for you to send critical funds when your kid’s in a jam!
- Square Cash allows you to send cash to friends and family for free. It’s the easiest app to use for this purpose, and Square is one of the top innovators in the payments space. NYTimes recently covered Cash, here. Square’s other offering, Square Wallet, will compliment Cash. Where accepted, it allows you to pay merchants for food, goods and services.
- PayPal powers most of the internet and has built itself the biggest, arguably most trusted, name in the payments industry. The mobile app allows you to send money to friends and family for free. Since most people have a PayPal account, adding the app takes little effort. Where accepted, the app also allows you to pay merchants for food, goods and services.
- Another company to watch closely is Ribbon! <– My referrer URL. Ribbon is currently restricting signups, and I am not currently a user, but I’m excited to see how this company grows. Their angle: “No more excuses about not having the same app. Friends don’t need to sign up before they pay you with a debit or credit card. Simply share the URL for your Ribbon profile page with anyone…”
- See my additional suggestions for sending and receiving money!
And now the more traditional stuff… Banking needs!
To power mobile offerings and ensure students can realize their #YOLO dreams, there are still a few needs to be met by banks and credit unions. Here are the critical tools that students should consider as they transition to financial independence:
- FREE, no-strings-attached checking account (no balance, direct deposit, or other requirements). Today’s financial tools for sending and receiving money rely on the ability to debit or credit a checking account. This also gives student an account to start building their nest egg.
- Debit/ATM card (typically included with checking). Access to cash remains important for splitting bills, repaying friends, and dropping a few bucks in the bucket at fundraisers. Late night studying at the library and off campus may also require dollar bills for vending machines and smaller coffee and snack vendors.
- Low-limit credit card. Travel makes having a credit card essential. Students rent cars and pay for hotels, and nobody knows better than a poor student how painful a $300 hold on one’s checking account can be (when paying with a debit card). Low-limit credit cards also provide a safe means for students to begin building their creditworthiness – which may or may not be interesting – to serve the old-world credit score that governs much of American finance.
Armed with the right tools, our starving students will be more financially informed and enabled. No more couch diving for loose change when it comes to paying for books, repaying friends, or making a late night Jack in the Box run!