LowCards.com Weekly Credit Card Update–November 21, 2014

November 21, 2014, Written By Lynn Oldshue
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Shoppers Just Don’t Care About Credit Card Hacks
If Target and The Home Depot are still reeling from the collective breach of 96 million customers’ credit and debit cards, it didn’t show in either company’s earnings reports this week. Target posted $17.73 billion in revenue on Wednesday, beating one Wall Street consensus forecast by $17 million. That paled in comparison to Home Depot’s rosy earnings report on Tuesday, which showed store sales in the U.S. climbed by 5.8% in the third quarter. Breaches? What breaches? Story by Dan Kedmey for Time.

Credit Card Rates are Likely to Rise in 2015
The interest you are charged on an unpaid credit card balance is tied to any movement in whatever benchmark index or rate the card issuer uses. Many credit cards use the prime rate (the lowest rate of interest at which banks lend money) as their benchmark. Since December 2008, the prime rate has been stuck at 3.25 percent. That’s all about to change. Story by Suze Orman for CNBC.

Warren Buffett Loves Credit Cards and GM
Warren Buffett is a fan of credit cards these days. The legendary investor increased his stakes in Visa and MasterCard last quarter by 20% and 16%, respectively, according to an SEC filing released Friday that shows the holdings of Buffett’s company Berkshire Hathaway. The move is likely a bet that consumers are ready to spend again as the economy picks up steam. Both companies reported a jump in credit card volume last quarter, especially in the U.S. Lower gas prices are also leading many analysts to forecast a strong holiday shopping season. The thinking is that consumer will have more money in their pockets because of savings at the pump. Gas is under $3 in most parts of America. Story by Jesse Solomon for CNN Money.

Merchants Get PayPal, Square Loans to Ready for Holidays
Across the U.S., small businesses preparing for the most lucrative time of year have found a new source of capital: digital-payment providers PayPal and Square. The companies have extended more than $275 million in financing to about 40,000 merchants over the past year, with demand for loans spiking when businesses need to build up inventory for the holidays. In the process, PayPal and Square are encroaching on the turf of banks and other lenders. The practice highlights a growing side business for PayPal and Square, which can use data they collect in processing transactions to find new business opportunities. PayPal began its merchant-lending program in September 2013, with Square starting the Square Capital program in May. The companies make pre-screened loan and cash-advance offers to select merchants based on their sales histories. Story by Spencer Soper for Bloomberg Businessweek.

Debts Canceled by Bankruptcy Still Mar Consumer Credit Scores
Tens of thousands of Americans who went through bankruptcy are still haunted by debts long after–sometimes as long as a decade after–federal judges have extinguished the bills in court. The problem, state and federal officials suspect, is that some of the nation’s biggest banks ignore bankruptcy court discharges, which render the debts void. Paying no heed to the courts, the banks keep the debts alive on credit reports, essentially forcing borrowers to make payments on bills that they do not legally owe. The practice, a subtle but powerful tactic that effectively holds the credit report hostage until borrowers pay, potentially breathes new life into the pools of bad debt that are bought by financial firms. Story by Jessica Silver-Greenberg for The New York Times.

Federal Reserve Meets with Big Banks, Regulators on Libor Alternatives
The Federal Reserve met with big banks and international regulators on Monday to discuss alternatives to the current London interbank offered rate, or Libor, in the wake of a rate-rigging scandal that has called the widely used benchmark into question. Major Wall Street banks, as well as regulators from Europe and Japan, attended the meeting at the Federal Reserve Bank of New York. Fed Gov. Jerome Powell, who was expected to attend, said Monday the Fed’s aim is to “start the process of choosing a risk-free rate” as an alternative to Libor. Story by Ryan Tracy for The Wall Street Journal.

Google Wallet Will No Longer Process In-App Purchases
Google Wallet recently announced that it will no longer be processing in-app payments as of March 2015. The company has not provided recommendations for any replacement services for merchants to use. According to a question and answer section on Google’s support site, Google is encouraging merchants to switch to other technology sooner rather than later. The company says, “To preserve your user experience, we highly recommend removing your integration and migrating to another payment processing solution as soon as possible.” Story by Lynn Oldshue for LowCards.com.

Federal Agents Arrest Debt Collectors in Crackdown
The government is putting debt collectors on notice. Federal agents in Georgia arrested John Todd Williams, 48, founder of debt collection agency Williams, Scott & Associates along with six other employees on Tuesday morning for allegedly running a $4.1 million debt collection scam that targeted more than 6,000 people across the United States. The arrests stem from an investigation by the Federal Bureau of Investigation, the U.S. Attorney’s Office, the Federal Trade Commission and the Consumer Financial Protection Bureau. It appears to be the first time federal authorities have taken coordinated action against debt collectors, and could be the beginning of a broader crackdown. Story by Ben Rooney for CNN Money.

4 Ways You’re Accidentally Committing Credit Card Fraud
Credit card fraud law covers a wide range of activity, and the terms and conditions of credit cards are lengthy and difficult to understand. Combine both of those and it makes sense that consumers can unknowingly break the law. Committing credit card fraud, whether it’s on purpose or by accident, can carry legal and financial consequences and might impact your ability to obtain future credit or even open a bank account. Keep the law on your side by knowing what to watch out for. Story by Morgan Quinn for Huffington Post.

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 14.49 percent, slightly lower than last week’s average of 14.50 percent. Six months ago, the average was 14.47 percent. One year ago, the average was 14.42 percent.



The information contained within this article was accurate as of November 21, 2014. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.