LowCards.com Weekly Credit Card Update–August 11, 2017

LowCards.com Weekly Credit Card Update–August 11, 2017

August 11, 2017         Written By Lynn Oldshue

America’s Credit Card Holders are $1 Trillion in Debt
The amount Americans owe on their credit cards has hit a new high at just over $1 trillion, according to Federal Reserve data, topping the previous mark set in April of 2008 just before the Great Recession. Not everyone carries credit card debt from month to month. But for those who do, the average figure per household is now $9,600, according to the online credit card marketplace. That equals about 17 percent of the average U.S. household income. And since the average interest rate on a credit card is 16 percent, and about 24 percent for those with subpar credit, that debt grows between $1,600 and $2,300 each year. Story by Ed Leefeldt for CBS News

BofA’s New Premium Rewards Card Comes With a Twist
Bank of America is preparing to join the premium rewards card fray, planning a new twist on hot products like the Sapphire Reserve card from JP Morgan Chase. Over the past year, rewards cards such as Sapphire Reserve and American Express Co.’s Platinum card have become much sought-after among millennials and big spenders. The cards’ popularity has prompted new entrants and ever-higher rewards, and caused some concern among issuers, who fear an overheated market. Bank of America is the last of the four largest U.S. credit card issuers to enter the premium rewards card market. Rolling out in September, its Bank of America Premium Rewards credit card will have a $95 annual fee. That is well below fees of $450 for Sapphire Reserve or $550 for AmEx’s Platinum card. Bank of America’s card will distribute two points to cardholders for every dollar they spend on travel and dining and 1.5 points per dollar spent on everything else, without caps on the number of points users can earn. But Bank of America cardholders who have at least $20,000 at the bank in checking, savings or investment accounts will earn more. Story by AnnaMaria Andiotis for The Wall Street Journal

Millennials Don’t Know How Credit Cards Work
Before your son or daughter starts using credit, make sure he or she understands that a credit card could be a weapon of self-destruction. That’s because a new survey found that “millennials’ knowledge of credit cards is lacking” and “very concerning.” A few millennials (6%) actually believe that missing a card payment would “improve” their credit rating. 17% said missing a card payment would have no effect on their score. The report also found that some 36 percent have maxed out cards. Some 48 percent carry card balances on which they pay hefty interest charges from month to month. That doesn’t seem to make a difference to 45 percent of those questioned. They didn’t even know their credit card interest rate. Story by Gregory Bresiger for The New York Post

J.P. Morgan Chase Axes Popular Debit Card Feature
J.P. Morgan Chase has quietly canceled a popular program that allowed customers to replace lost debit cards at many of its 5,300 branches, responding to factors including an uptick in fraud. The change means that customers who lose their debit card or have it stolen will have to wait for a new one to be mailed to them. J.P. Morgan had machines to make the cards in about half of its branches. That would be about 2,650 locations. The bank started eliminating the service in March, and finished late last month. Story by Kate Fazzini and Emily Glazer for The Wall Street Journal

New Texas Law Allows Merchants to Decline Card Purchases Without ID
A law that takes effect in January will allow Texas merchants to ask for photo identification for credit and debit card purchases – and turn down transactions if a buyer won’t show it. The aim of the law, which the Legislature passed during the regular session that ended in May, is to reduce debit and credit card fraud. Though merchants will sometimes pick up the tab for money lost to fraud, it often falls to banks to absorb the losses and replace compromised cards. Merchants can ask to see photo ID, but contracts they have with credit card companies often bar them from declining a transaction if a customer refuses to show it.  Several other groups opposed the legislation, including a state retailers association whose lobbyist suggested that letting employees determine which customers must show an ID could be perceived as discriminatory or biased. Story by Shannon Najmabadi for the Texas Tribune

3 Credit Card Alerts Worth Setting Up Now
Your secret weapon for better managing your credit cards could very well be the same device you’re reading this article with: a smartphone. Consumers are relying more than ever on credit card push notifications or pop-up alerts in apps, according to data from banks that show how use has grown from 2016 to 2017. These messages, which appear as banners on smartphone screens, can be customized to alert you to account activity in close to real time, helping you stay on top of your spending while avoiding penalties. They’re already popular with younger cardholders: About 40% of millennial consumers—those ages 18 to 34—receive financial alerts as push notifications. Here are three notifications to set up that could help you handle your cards more responsibly. Story by Claire Tsosie for USA Today

Credit Card Surcharges: U.S. & UK Customers Pay Different Fees, Here’s Why
The credit card marketplaces of the U.S. and U.K. are a study in contrasts when it comes to their respective treatment of interchange fees, the charges merchants pay for each transaction to card networks such as Visa and Mastercard. Specifically, the two countries’ retail marketplaces differ in if, and how often, those card charges get passed along to consumers. U.S. merchants are taking to court to seek more flexibility in explicitly passing those charges along to their customers. Across the Atlantic, meantime, a backlash grows against the more open (and, some say, exorbitant) surcharges imposed by many U.K. retailers. The experience in the U.K. may provide an instructive, even cautionary, tale for American retail businesses. Story by Robert Harrow for Forbes

Mastercard Files Patent for Refund Services for Cryptocurrency Users
Mastercard has filed a patent application with the US Patent and Trademark Office for the creation of refund services for digital currency users. In the patent titled “Information Transaction Infrastructure,” the company hinted at its plan to explore possible means of implementing this feature. Based on the published document, the proposed service will establish an infrastructure that would allow users to verify their identities and link them to the digital currency addresses that they had chosen to disclose. The system being proposed by Mastercard aims to facilitate the refund process in payment transactions. Under the current system, a customer who requests a refund must have the funds sent back to the same address they paid from. Mastercard suggests the creation of a service that will allow users to choose to send refunds to a different wallet address. This system will help facilitate the refund of payments much easier and quicker. Story by Joshua Althauser for The Coin Telegraph

Verizon Center to Become Capital One Arena, Starting Now
Washington’s downtown sports arena is changing names, effective immediately. Monumental Sports and Entertainment will make the switch official on Wednesday, announcing that Verizon Center will now be known as Capital One Arena. The signage and branding makeover will happen this fall, but there’s already a new logo and a third name for the Chinatown venue, which opened as the MCI Center in the winter of 1997. The Verizon deal was set to expire in 2018, but Capital One’s involvement accelerated the schedule. Financial details were not released, but the deal is worth $100 million over 10 years, according to a source. Story by Dan Steinberg for The Washington Post

Shoppers Have Many High-End Card Options, but for How Long?
Shoppers with means who want a lot of high-end rewards on their credit cards have plenty of options, at least right now. Since JPMorgan Chase launched the $450-a-year Chase Sapphire Reserve Card a year ago, joining the market created by the American Express Platinum Card, companies like U.S. Bank and UBS have jumped in with similar cards. Citi’s Prestige card, which gives the unique benefit of a fourth night free at hotels, already existed. The increased competition could help customers. Banks sometimes waive annual fees or offer additional points for certain types of spending in order to drive business. And analysts say the companies’ desire to keep their cards distinctive may mean they offer more benefits. But whether enough people want to hold these cards may determine how sustainable the profusion is. Story by Ken Sweet for the Associated Press

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 15.43 percent, identical to last week. Six months ago, the average was 14.97 percent. One year ago, the average was 14.63 percent.


About Lynn Oldshue

Lynn Oldshue has written personal finance stories for LowCards.com for twelve years. She majored in public relations at Mississippi State University.
View all posts by Lynn Oldshue
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