LowCards.com Weekly Credit Card Update–October 10, 2014
Banks in U.S. Moving to Chip-Based Debit and Credit Cards
In the coming year, banks in the United States are likely to replace debit or credit cards with versions that have tiny computer chips embedded in them, a move aimed at making shopping in stores more secure. Bank of America, for instance, has just announced that, beginning this month, all new bank customers will be issued debit cards with chip technology, and that existing cards will be upgraded as they expire. The cards work by creating a unique code for each transaction. While the change will not necessarily stop data breaches from occurring, security experts say, the chip technology prevents criminals from using stolen information to create counterfeit cards. Most credit and debit cards in the United States rely on older “magnetic strip” technology, which is vulnerable to hacking. Story by Ann Carrns for the New York Times.
Consumer Borrowing Jumps to Record Level
U.S. consumers increased their borrowing in August in the category that covers auto loans and student loans but cut back on their credit card borrowing. The Federal Reserve says that overall borrowing rose $13.5 billion in August following a revised $21.6 billion increase in July. The gains have pushed total consumer debt to a record level of $3.25 trillion. Story by Martin Crutsinger for the Associated Press.
CFPB Keeps Data on Nearly 600 Million Credit Card Accounts
The Consumer Financial Protection Bureau is collecting sensitive financial data on close to 600 million credit card accounts but lacks adequate privacy and security plans to protect the information, according to a new report from the Government Accountability Office. “The CFPB’s massive data collection effort is an unwarranted, unwelcome intrusion into the private financial lives of millions of Americans,” said Senator Mike Crapo in a statement. Crapo requested the nonpartisan GAO report. The report also found the CFPB was collecting data on 11 million credit reports, 29 million active mortgages and 5.5 million private student loans. Story by Natalie Rutledge for LowCards.com.
Get Rid of Your Credit and Debit Cards
Our debit and credit cards use magnetic stripes, 1950s technology that freely transmits financial data to store registers. Yet these transactions occur on vulnerable computer networks. Fraudsters use military-grade software weaponry to capture that information as it bounces from store to payment processor to credit card network and, eventually, the bank. It’s no surprise that Home Depot, Michaels and Target collectively lost data on 99 million cards in the last year. Jose Pagliery for The New York Times.
Moving to ‘Smart’ Credit Cards Will Help with Security
The data security mess is going to get a lot worse before it gets better. Technology innovations are fueling exponential growth in the number of Internet-connected devices, the complexity of those devices and the value of the data on them. These advances are bringing great benefits but have made our computer systems too complex to debug fully or even understand. Criminal hackers have a large and growing supply of vulnerabilities to exploit. Story by Paul Kocher for The New York Times.
Your Phone is Your Next Credit Card
You already have your next credit card. It’s sitting in your front pocket. People have possessed the ability to spend and send money with their smartphones for years, but mobile payments have yet to take off in a big way. Plastic and cash are still the preferred modes of buying stuff—by a long shot. But four recent events suggest that mobile payments are about to take off in a big way. Story by Doug Gross for CNN.
5 Tech Companies Making Credit Cards Safer
In 2013, at least 740 million-plus records were compromised, according to the Online Trust Alliance–and the list is rapidly growing as major retailers can’t seem to stop hackers from getting to shoppers’ personal data. The switch to PIN and chip readers (already the norm in many other countries) is on the horizon–a change that will undoubtedly make using your plastic safer. But in the meantime, a number of tech companies have been hatching some innovative solutions, each intended to make commerce feel a bit more secure. Story by Carley Knobloch for Betterment.
Check Your Credit Card Bills for These Added Fees
Some credit-card holders are unknowingly paying for identity-theft protection and related services. Cardholders, especially those who signed up for a new card over the past few years, should check their statements for fees related to services that they may not have asked for and may not want. Story by AnnaMaria Andriotis for The Wall Street Journal.
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 14.56 percent, slightly higher than last week’s average of 14.54 percent. Six months ago, the average was 14.45 percent. One year ago, the average was 14.40 percent.