LowCards.com Weekly Credit Card Update–February 26, 2016
MasterCard Wants You To Pay For Stuff With Selfies
MasterCard is rolling out a new strategy in the fight against credit card fraud: It wants you to pay for things with your face. The credit card company unveiled its new “selfie pay” feature, which will allow cardholders to use an image of their face or a fingerprint to verify their identity when making payments online. To use selfie pay, cardholders will have to download MasterCard’s app to their mobile device or tablet. Customers will still need to provide their credit card details to make purchases, but if further authentication is required, they can hold their device up to their face and take a photograph or use the device’s fingerprint sensor. MasterCard plans on rolling out the feature in the coming months in several countries, including the U.S., Canada, the U.K. and parts of Europe. Story by Dominique Mosbergen for Huffington Post.
Girl Scouts: Want to Sell More Cookies? Think Mobile Payments
Girl Scouts attempting to sell cookies these days have seen better days. A general malaise in the economy coupled with less spending, backed up by fake Girl Scout cookies roaming around the stores and recipes for mimics online, makes it tough to sell the cookies everyone once loved. A new development noted by Sage, however, shows that one tactic seems to be making a big difference in cookie sales: the use of mobile payments tools. For 30 Girl Scout councils, and over 3,800 troops in the United States, the use of Sage Mobile Payments seems to be producing some new value for Girl Scouts. Scouts using Sage are averaging five boxes per transaction, which is up from four boxes per transaction in 2014. Story by Steven Anderson for Payment Week.
Banks Team Up for Mobile Cash Transfers
Big banks have banded together to battle back against the rising tide of payment start-ups. Seven banks have invested in a digital payment network to launch a peer-to-peer mobile product to help them fend off a growing number of start-ups elbowing into their space. Smartphone-based peer-to-peer payment between banks’ apps is expected to launch for most firms this summer, and represents a growing challenge from Wall Street to fintech firms like Square and PayPal. BB&T, Wells Fargo, PNC Financial Services Group, Capital One, Bank of America, JPMorgan Chase and US Bancorp are participating in the new clearXchange network, representing 60 percent of the current mobile banking market. Story by Jon Marino for CNBC.
Google to Shut Down Its Comparison-Shopping Website
Google is shutting down its Google Compare comparison-shopping site, marking a retrenchment from the search giant’s foray into selling financial products like insurance and credit cards, according to a spokeswoman and partners who work with the company. Google, whose parent company is Alphabet, has been running Google Compare in Britain for three years and started its highly anticipated United States site last March. Despite Google’s being the biggest name in search, insurance industry partners and an internal email said the sites never really caught on with consumers. Google, which had formed several insurance-industry partnerships to get access to broker networks, is telling partners that it is shutting down both its British and United States sites in about a month. Story by Conor Dougherty for The New York Times.
Visa is Ready to Expand Smart Payments to Cars, Wearables and Fridges
Visa is expanding its seamless smart payment solution, Visa Ready, targeting 50 billion connected Internet of Things devices by 2020. The Visa Ready Program, previously only used by mobile point-of-sale acceptance providers, mobile NFC-enabled device manufacturers and chip and platform providers, will include other IoT companies such as manufacturers of wearables, automobiles, appliances, public transportation services and clothing. Visa Ready has been designed for companies to integrate Visa’s payment services into their products and services and uses any available internet connection to carry out a transaction. Story by Joao Lima for Computer Business Review.
Chase’s Mobile Payments Strategy Includes Starbucks Pact
Chase Tuesday announced during its Investor’s Day gathering in New York City that Starbucks will accept Chase Pay as a payment option later this year at its 7,500 U.S. locations. Starbucks also will integrate Chase Pay into its mobile app as a funding source for prepaid account reloads similar to what it has now for Apple Pay. Chase Pay, which is scheduled to debut later this year, is both an in-store and in-app payments scheme. Chase’s premier partner for the system was and still is the Merchant Customer Exchange. But MCX’s CurrentC mobile app is still limited to one test market in Columbus, Ohio. Chase and Starbucks have a prior history together, so the partnership isn’t something out of left field. Story by Will Hernandez for Mobile Payments Today.
MasterCard Improves Security to Prevent False Card Declines
Have you ever gone shopping in a different city, only to have your credit card falsely declined? This is likely the result of your credit card company’s security system attempting to prevent fraudulent transactions on your account. The protection is designed to be helpful, but it can sometimes turn into an inconvenience. MasterCard is working to reduce the chances of these unnecessary card declines through a program called MasterCard IQ. The company has already invested millions of dollars into its worldwide communication network to decrease false declines by 25%. The plan is to use data collected by retailers and smartphone companies to monitor your location and verify you are where your card is being used. Rather than calling your card provider to let them know you are traveling, you can simply use your card as normal and let MasterCard’s intelligence do the rest. Story by Bill Hardekopf for LowCards.com.
Synchrony: A Growing Credit Card Powerhouse
The credit card industry is facing head winds as major players duke it out for customers. But one part of the market isn’t getting enough credit: private-label cards, which typically are branded with one retailer and offer consumers perks that include discounts, loyalty rewards, and promotional financing. Private cards are gaining market share, growing at a 7% annual clip, compared with 5% for traditional offerings, says Bill Carcache, an analyst at Nomura Securities. The industry leader is Synchrony Financial, which was spun off from General Electric in 2014. The company has gained 12 points of market share since 2004, to an estimated 43%, according to the Nilson Report and Nomura. Synchrony’s retail card division partners with 22 merchants, including Amazon.com and Chevron. Story by Lawrence C. Strauss for Barron’s.
1 in 4 Americans Have More Credit Card Debt Than Savings
Things aren’t looking good for America’s pocketbooks. Just 52% of Americans have more savings than credit card debt, according to a new survey released by Bankrate.com. That’s down 6% from 2015, when 58% of Americans had more emergency savings. And almost one in four have more credit card debt than emergency savings, while 21% of Americans have no credit card debt but no emergency savings either. This backs up an earlier survey, which found only 38% of Americans have enough savings handy to cover an unexpected expense of $500 to $1,000. Story by Alicia Adamczyk for Time.
Citibank Will Stop Collecting $34 Million in Credit Card Debt
Certain credit card debtors are in for some relief. Citibank has agreed to provide nearly $16 million in consumer relief and forgo collecting on about $34 million in debt held by nearly 7,000 cardholders as part of two enforcement actions taken by the Consumer Financial Protection Bureau. The CFPB consent orders, released on Tuesday, allege that, from February 2010 until June 2013, Citibank sold credit card debt with inflated interest rates and failed to forward consumer payments promptly to debt buyers, who went on try to collect on 128,809 accounts sold to 16 different debt buyers. For some accounts, Citibank claimed the APR was 29% when it was actually 0%, the CFPB said. Story by Jeanine Skowronski for Reuters.
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 14.83 percent, identical to last week. Six months ago, the average was 14.60 percent. One year ago, the average was 14.45 percent.