SmarterBank Debit Card Offers Graduates More Debt

Monday, April 9, 2012, 2:00 AM | 3 Comments

On Wednesday, April 4, 2012, SmarterBank Visa debit card offered graduates who are in debt – and who isn’t – that they can get out of debt by spending more. Many blogs have commented on the offer. It’s another of marketing pitch that some banks use. I bet they have done a lot of research to come up with the offer. If you think about the bank name, it’s smarter for itself, not for student graduates.

Here is how SmarterBank Debit card works…

If you spend up to $100 in a month, you get 0.5% back. That’s 50 cents. I mean 50 cents a month. Spending over $100 a month will get you 1% in rewards. So you gotta spend $1,000 a month to get refund of $10.

SmarterBank will put the reward money towards their student loan balances. That means you have to spend $1,000 a month to get $10 back. Is it worth it? Well! You be the judge of it.

According to, regular debit card gives you 0.5%. If you are a millionaire or more correctly a billionaire, 0.5% can make a considerable difference in your finances. The banks will never market this kind of deal to the super rich – the so-called 1%.

It is, pure and simple, marketed towards those students who could not afford college on their own, got loans, got education (whatever that means) and are now stuck in the quagmire of the debt shit.

Give me a break. That’s another way to get the consumers deeper in debt shit. Do they think American consumers are that dumb? They may be greedy, ignorant but they are definitely not dumb. Well! May be some are.

What student graduates will get out of it…

The graduates would get deeper and deeper in debt even if they are careful in handling their money. They have already stepped deep in debt shit while they were students.

It is projected that student loan, on the average, will hit $28,700 this year. Close to 37 million Americans have outstanding student loans, according to Last year, 66% — or 1.8 million – of Bachelor’s degree recipients had student loans – a figure that’s expected to rise.

What SmarterBank will get out of it…

Remember banks and other lending institutions are in the business of making money from their daily operations. They don’t give a shit whether their offer will screw up consumers’ financial life or not.

Frequently they have been successful in messing people’s lives because of their ignorance, greed and just plain screw-ups.

The bank seems to be only worried about how it would make a killing in profits. In a sense it forces the graduates to keep overspending. There may be occasions when they might not need to buy anything but to save $10 on $1,000 a month spending, they would keep buying unnecessarily.

Remember the bank is offering the deal – if you can call it that – for one simple reason, not to get you out of debt but to make money off of the students debt.

Let’s talk about the fees SmarterBank will charge…

Cardholders will pay a $2 fee if they use an ATM outside the card’s network, while the average out-of-network fee is $1.41, according to

Get a load of this. Checking account includes a fee of $5 to get a copy of bank statement and a research fee of $25 per hour if the cardholder wants the bank to review the account. This is something new. Many banks don’t charge for research.

Alternatives to SmarterBank Debit card…

There are some definite alternatives where the graduates would not be under pressure unnecessarily to spend and keep spending. Community banks and credit unions in your local area generally offer free debit cards. Check with these institutions if they offer rewards. Chances are they do.

How about using credit cards? Their fees are on the down slope whereas the rewards are rising. Millions of consumers are able to avoid interest charges by paying their balance in full. They could potentially earn more in rewards than they would with a debit card.

In a Nutshell
If I were living under the burden of student loan, I would not join SmarterBank program. I would spend according to my needs as usual and try to save as much as I can. I would then put the money towards paying down my student loan.

SmarterBank seems to be putting pressure on graduates to spend $1,000 so they can save $10. In my opinion, it’s not worth it. I would use the word counterintuitive for this program.

Not a single institution or person can help you. The only person that can help you is you to pay down your debt gradually but surely.

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  1. 3 Responses to “SmarterBank Debit Card Offers Graduates More Debt”

  2. By Bethany on Aug 2, 2012, 2:53 pm | Reply

    Thank you for the review! I’m subscribed to DailyWorth’s website and they just sent out an advertisement for SmarterBank. Definitely not gonna look anymore into it. Way to contribute to financial wisdom on the web. Thank!

  3. By Sarah on Oct 11, 2012, 4:47 pm | Reply

    In receiving an email about smarter bank, I decided to look for reviews and found this one. Wow.I think it is hilarious and absolutely ridiculous that you think a debit card can force a person into deeper debt. Many people (all?) people use their debit card to pay rent, car payments, normal monthly bills, etc. So if you are spending the money anyways, why wouldn’t you want a reward? Please show me the intelligent student graduate who will spend more than usual just to get an extra $1. This person will be in debt regardless if they can’t figure the cons of doing that. Once again, blame is placed on The bank when it’s the person spending the money. What’s funnier than the article itself is the fact that it actually swayed the above reviewer from joining… Again, hilarious. Best of luck!

  4. By Audrey on Jun 14, 2013, 9:32 am | Reply

    I think this article is bullshit. Not all college grades are making $12,000 a year. I’m a college graduate, making $60,000 a year. I own a house and I’m 26 years old. I use my debit card for 99% of my purchases. When remodeling my house I used the Smartbucks “mall” and was able to get 3% back on appliances etc. When buying things like computer ink, you get 10% back – clothing 3%. There’s a lot more to Smartbank than just the .05% – 1% back. The bank is connected to the Star network so there’s hundreds of free ATMs all over the US. Do your research before making idiotic accusations.

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