When students enter the higher educational institutions, they collide with new circumstances, environment and impressions. First of all it means the people become independent, but in the same time they have to make their own decisions and to earn their own money. Usually in the college or university the students receive their first credit card and they begin in such way their credit history. There are special students’ credit cards, which were established specially for the college and university students. The students must be responsible, self – disciplined and have to use the credit card wisely.
In general, the student`s credit cards have many in common with the usual credit cards. But in the same time there are some differences, which first of all refer to the fact, the these cards are the first credit cards in the lives of the students and they do not have an experience in this field. Usually those people who enter the university do not have the credit history. It means for the lender that he cannot be sure that the client will pay the credit bills in time. Because of it in many cases the lender requires the parents of the students to co-sign the credit card agreement with the students. In the case of non – payment the co – signer will be responsible for the debt. Besides, the second difference is that the credit limit on the student`s credit cards is usually lower than on other credit cards and is about $ 1000 per months. It is quite enough for the expenses of the average student. The third difference refers to the level of the interest rates. This level is quite high. It is usually done to force the students to pay the credit bills in time.
But in the same time if the students keep all rules and pay the bills in time, he can establish good credit history and credit score. It is very advantageous for the future.