The new scheme to pay off student debt with travel points is more of an opportunity for politicians to pat each other on the back then to combat the financial burden.
Employment and Social Development Canada got the go ahead from the Conservatives to work out a deal with Higher Ed Points, a private company, to allow students to put reward points towards tuition and loan payments.
The thought of corporations capitalizing off of students’ desperate financial troubles is discomforting.
Companies offer reward points to encourage consumers to spend more money. To redeem a significant portion of money to pay off tuition or debt, a student, who’s already strapped for cash, would have to spend thousands of dollars.
It’s no wonder the company is so eager to put forward this deal. It takes 35,000 Aeroplan points, which requires spending a significant amount of money, to repay $250 of debt.
People who have a lot of debt usually don’t have a lot of disposable income. Those who rack up travel points also might not overlap with those who are in debt.
After all, the biggest expenses that put students into financial stress don’t accrue points. Students aren’t going into debt due to groceries or clothes shopping. It’s expenses like tuition, rent and textbooks that are the real strain.
Anything that helps students pay off debt is good, but trading reward points for loan repayments doesn’t fix the problem, it simply makes a good headline.
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