LowCards.com Weekly Credit Card Update–April 24, 2015
House Passes Cybersecurity Bill After Companies Fall Victim to Data Breaches
Responding to a series of computer security breaches in government and the private sector, the House passed an expansive measure Wednesday that would push companies to share access to their computer networks and records with federal investigators. The House measure, already largely embraced by the White House, passed, 307 to 116. Should the House and Senate come together on final legislation, it would be the federal government’s most aggressive response yet to a spate of computer attacks that helped sink a major motion picture release by Sony Pictures Entertainment, exposed the credit card numbers of tens of thousands of customers of Target stores and compromised the personal records of millions of people who did business with the health insurer Anthem. Story by Jennifer Steinhauer for The New York Times.
Discover CEO: Expect ‘Rocky’ Rollout of Payment Cards with Chips
The rollout of credit and debit cards with embedded microchips will be “rocky,” as consumers begin to realize they must dip the plastic instead of swipe it at the nation’s cash registers, the chief executive of Discover Financial said Tuesday. Banks and other financial services providers nationwide have been adding chips to their credit and debit cards because they’re less prone to fraud than those with the magnetic strips to which U.S. shoppers are accustomed. Credit card companies have said that, as of October 2015, their fraud policies will change, and any merchant that doesn’t have a chip-compatible payment system will assume liability for counterfeit card transactions. “This is a huge change for consumers” when it comes time to step up to the cash register, Discover CEO David Nelms said. “Consumers are going to have to start dipping the card instead of swiping it.” Some retailers won’t even have the new terminals, he added. Story by Becky Yerak for the Chicago Tribune.
A Third of Millennials Have Never Had a Credit Card
In a society where tens of millions rely on a credit card to shop or pay bills, a new survey reveals that more than a third of Millennials have never had one. 36% of Americans between the ages of 18 and 29 have never had a credit card. That may be due in part to a 2009 law that whittled away the near-ubiquitous offers of credit to college students. Those reforms stated that those under age 21 had to prove their income or get parental permission in order to obtain a credit card. The Great Recession also may have left some younger consumers reluctant to rack up charges. Story by Charisse Jones for USA Today.
Costco to Pay Almost Zero to Accept Credit Cards
Costco has attained a goal that retailers have sought for years: near-zero expenses for credit-card payments. In a deal with Visa and Citigroup, Costco’s acceptance costs will be about zero, according to people familiar with the arrangement. That compares with the roughly 0.6 percent of each transaction the retailer pays its current partner, American Express. While Costco will still incur small fees on Visa cards issued by other banks, incentives from Citigroup and Visa will offset them. The arrangement shows the pressure that Costco, the biggest U.S. retailer that accepts just one brand of card, was able to exert on financial firms seeking one of the industry’s most coveted partnerships. Story by Elizabeth Dexheimer and Matt Townsend for Bloomberg Business.
Southwest Airlines May Replace Chase for Credit Cards Program
Southwest Airlines is considering replacing JPMorgan Chase as the issuer of its credit card rewards program, according to two people familiar with the matter. One of those people said Southwest has hired investment bank First Annapolis as an adviser as it reviews the relationship with Chase. Visa is also part of the relationship with Southwest and Chase, though it could not be determined whether that relationship, where less money is at stake, is also part of the review. While the size of the Southwest program could not be determined, both sources said it is considerably larger than $1 billion in receivables, while one said it is “several multiples of that,” and considerably larger than one would expect from an airline the size of Southwest. Story by Dan Freed for The Street.
Trade Group Asks for Delay on Card Security Plan
A trade group representing thousands of retail food stores and pharmacies is asking the payment-card industry to delay an October plan that puts merchants on the hook for fraudulent transactions if they don’t have equipment in place to accept more secure credit and debit cards. In a letter sent to Visa, MasterCard, American Express and Discover, the Food Marketing Institute said that merchants won’t be ready to meet an October deadline that will shift liability for fraudulent transactions from card-issuing banks to merchants. Story by Robin Sidel for The Wall Street Journal.
New Credit Card Code May Boost Legal Online Gambling
A change in the way credit cards are categorized may soon give legal online casinos a significant boost in sales. The state of New Jersey has developed a new Merchant Category Code that separates legal and illegal gambling transactions, giving banks the opportunity to start approving the charges from legal online casinos. The Unlawful Internet Gambling Enforcement Act of 2006 put some substantial restrictions on Internet gambling, making it illegal in the United States. Recently though, special sanctions were put in place to allow online gambling in New Jersey, Nevada, and Delaware. Under the law, online gambling transactions were not approved by banks and credit card issuers because they were categorized with four simple digits: 7995. That is the category code given to all online gambling efforts. Story by John Oldshue for LowCards.com.
Apple Pay Trounces PayPal and Google Wallet in Customer Satisfaction
A new Changewave survey shows that when it comes to mobile payments, Apple Pay remains the player to beat. With each passing month, the number of Apple Pay users continues to increase. This of course shouldn’t come as too much of a surprise given that the number of iPhone users also increases every month. Additionally, Apple has aggressively increased the number of banks and credit unions that work with Apple Pay, a figure which now stands at over 200. Usage numbers aside, it’s also worth noting that Apple Pay users are seemingly much happier with their mobile payment experience than users who opt for rival payment services like PayPal or Google Wallet. Story by Yoni Heisler for BGR.
New Citi Credit Card Earns You an AT&T Smartphone, For a Price
Citi and AT&T announced Thursday the AT&T Access More Card, which comes with an opportunity to earn a new smartphone. New card customers will be directed to a website where they can purchase a new AT&T smartphone for full price. After that they have to make $2,000 worth of purchases with the new card within three months, maintain AT&T service for at least 15 days, and then the carrier will reimburse them for the cost of the device, up to $650. The reimbursement offer can be applied to any smartphone in AT&T’s portfolio but $650 won’t cover the cost of all devices, like the Samsung Galaxy S6 Edge and the iPhone 6 Plus. In addition to the smartphone reimbursement feature, the Access More card also earns customers reward points. Three points for every $1 spent on products and services purchased directly from AT&T, three points for every $1 spent on online retail and travel sites, and one point for every $1 spent everywhere else. Story by Ben Munson for Wireless Week.
LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.46 percent, slightly higher than last week’s average of 14.45 percent. Six months ago, the average was 14.52 percent. One year ago, the average was 14.47 percent.