LowCards.com Weekly Credit Card Update–August 7, 2020

LowCards.com Weekly Credit Card Update–August 7, 2020

August 7, 2020         Written By Bill Hardekopf

Interest Rates Are Low, But Loans Are Harder To Get. Here’s Why.
The economic crisis caused by the pandemic has driven interest rates to rock-bottom levels, meaning there has hardly been a better time to borrow. But with tens of millions of people out of work and coronavirus infections surging in many parts of the country, qualifying for a loan–from mortgages to auto loans–has become more trying, even for well-positioned borrowers. Lenders that have set aside billions of dollars for future defaults have also tightened their standards, often requiring higher credit scores, heftier down payments and more documentation. Some, such as Wells Fargo and Chase, have temporarily eliminated home equity lines of credit, while Wells Fargo also stopped cash-out refinancing. Story by Tara Siegel Bernard for The New York Times

Consumers, Flush With Stimulus Money, Shun Credit Card Debt
When unemployment soared this spring at the start of coronavirus lockdowns, credit card debt and delinquencies were widely expected to surge as struggling households borrowed more to make ends meet. Instead, amid the deepest economic crisis since the Great Depression, the opposite happened. Credit card debt in the U.S. and other advanced economies has fallen. Fewer people are late on their credit card payments. Consumer demand for new borrowing—through credit cards, personal loans and even pawnshops—is down sharply. Story by Matthew Dalton and AnnaMaria Andriotis for The Wall Street Journal

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Don’t Throw Out Prepaid Debit Cards When They’re Done
If you were gifted a prepaid debit card at any point this year you may want to reconsider throwing them out when you finally decide to de-clutter your wallet, instead save the card even when its balance is spent. If you end up getting a refund or rebate for your purchase, it may go directly onto the card before you have a chance to ask the merchant to process things otherwise. If the card is gone, so is your refund. You can also use the empty card as a dummy card for signing up for free trials. Lots of free trials automatically kick in with a monthly or annual charge once your try-out is over. Story by Jaime Green for Lifehacker

Get $15 Off At Amazon When Using Your Eligible Chase Credit Card
There are many Chase credit cards that earn Ultimate Rewards points, and while those points are typically best used for travel opportunities, you can also redeem them at Amazon. While we normally suggest saving them for travel, right now Amazon is offering a great way to not only use your Chase points, but to also save on your next Amazon purchase. Chase credit card holders targeted for this promotion can save $15 on a purchase of $50 or more when using Chase Ultimate Rewards points at Amazon from now through October 31. And the best part of all is that you only have to apply 1 point for the discount to apply. Story by Jennifer Yellin for CNN

Citi’s New Credit Card Perk Gives Amazon Edge In Winning Big Orders
Citigroup plans to let credit card customers finance big purchases on Amazon.com over longer periods of time — a deal that may spur sales at the e-commerce giant while boosting the bank’s interest-bearing balances. Cardholders who’ve shopped on Amazon in the past 12 months can choose to pay off transactions of at least $100 on a longer schedule and at a lower annual percentage rate. It’s meant to give borrowers more options. For Amazon, it’s a way to increase so-called basket size, making sales more profitable. It may also give the retailer another edge on competitors. Story by Jennifer Surane for Bloomberg

Banking Regulator Fines Capital One $80 Million Over 2019 Hack
A top banking regulator has fined Capital One Financial Corp. $80 million over a 2019 hack that compromised the personal information of about 106 million card customers and applicants. The Office of the Comptroller of the Currency said the bank failed “to establish effective risk assessment processes” before transferring information-technology operations to the public cloud and “to correct the deficiencies in a timely manner.” Story by AnnaMaria Andriotis for The Wall Street Journal

Credit Card Data From JPMorgan Chase Shows The Economic Recovery May Be Stalling
Consumer spending data from JPMorgan indicates that the economic recovery has been stuck in neutral since mid-June, mirroring data of weekly jobless claims and hours worked by service sector employees. The chart, which measures use of select Chase credit and debit cards, showed that spending has been roughly 10% or more below its 2019 levels for over a month after rising sharply from its low point in late-March and early April. There was also a gap between different age groups. Spending by millennials and gen-z consumers was down 4.1% relative to last year, while spending by baby boomers was down more than 18%. Story by Jesse Pound for CNBC

Starbucks Mobile Orders Make Up Record 22% Of Transactions As Q3 Sales Sink 40%
More people than ever are buying Starbucks food and drink with their phone. The company said mobile orders reached a record 22% of transactions in its third fiscal quarter. Delivery orders also tripled from the previous quarter. Global same-store sales sunk 40% in Q3. To help increase sales, Starbucks is speeding up plans to roll out a new store concept called Pickup designed for customers who order ahead with the app. Starbucks has been testing the strategy at two Starbucks Pickup stores in Manhattan and Toronto over the past year. Story by Taylor Soper for GeekWire

Why 1% Could Be the Magic Number for Your Credit Score
In general, using as little of your credit card limits as possible is better for your score. So logic would suggest that paying off your credit cards early so that a zero balance is reported to the credit bureaus would produce the highest scores, right? Turns out, having 1% of your credit limits in use may help your credit score even more than showing 0% usage. Counterintuitive as it is, that’s how credit scoring works. Story by Bev O’Shea for The Street

Coronavirus Leads To More Use Of Contactless Credit Cards And Mobile Payments Despite Cost And Security Concerns
With consumers worried about touching surfaces during the coronavirus pandemic, the use of mobile payments and contactless credit or debit cards has significantly increased in the past few months, according to research released by the National Retail Federation and Forrester. The study found 67% of retailers surveyed now accept some form of no-touch payment. That includes 58% that accept contactless cards that can be waved past a card reader or tapped on the reader, up from 40% last year, and 56% that take digital wallet payments on mobile phones, up from 44%. Story by the National Retail Federation

Ford, Visa Team Up For New Credit Card With Rewards That Lead To Car Discounts
Ford is expanding its customer loyalty program by introducing the FordPass Rewards Visa Card in collaboration with First National Bank of Omaha and Visa. Applications are now being accepted for the card that offers everyday special financing, reduced cost of ownership via Points redeemable toward vehicle sales and service at Ford dealerships, member-exclusive benefits and Ford-focused card customization options. Story in Press & Guide

Mobile Bank Current Launches A Points Reward Program For Debit Card Users
Amid a crowded market of mobile banking services, which will soon also include Google, U.S. challenger bank Current is launching a new program that will offer points-based rewards to its checking account customers. The program will allow Current members to earn up to 15x points on everyday debit card purchases at over U.S. 14,000 merchants, including national retailers like Subway, Rite Aid, True Value, Cold Stone Creamery and others. Story by Sarah Perez for Tech Crunch

The information contained within this article was accurate as of August 7, 2020. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website. Many of the offers on this article are from our affiliate partners, and LowCards.com may be compensated if you take action with any of our affiliate partners.

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About Bill Hardekopf

Bill Hardekopf is the CEO of LowCards.com and covers the credit card industry from all perspectives. Bill has been involved with personal finance for over 15 years. He is a frequent contributor to Forbes, The Street and The Christian Science Monitor.