LowCards.com Weekly Credit Card Update–December 13, 2013
Mobile Banks Gaining Popularity with Young Consumers
The new alternative banks work with traditional banks to hold deposits, so the money in your account is FDIC-insured. GoBank is the mobile banking arm of the Green Dot Corporation, which holds the money deposited via GoBank. Simple and Moven are in effect banking services, rather than banks, but they work with traditional banks to handle the actual banking functions behind their mobile apps. Simple’s deposits are held at Bancorp Bank, based in Delaware, while Moven’s are held at CBW Bank, which is based in Kansas. But customers use the service through their mobile apps or websites. The new mobile banks are gaining in popularity. Simple became available to the public in July 2012 and now has about 80,000 customers. Story by Ann Carrns for The New York Times.
How Strict Limits on Debit-Card Fees Created More Free Checking
A new analysis from the Federal Reserve Bank of Kansas City finds that caps on swipe fees for debits cards have, almost counter-intuitively, given consumers more access to free checking accounts. From 2011 to 2012, the share of large banks offering free checking fell almost in half, to 27 percent. But small banks with assets under $10 billion are exempt from the law, and the share of small banks offering free checking rose from 37 percent to 44 percent in the same period. Because there are so many more small banks than large ones, this shift more than offset the decreases at big banks. Overall, the research showed that the volume of consumer accounts at banks that offered free checking rose from 19.4 percent in 2011 to 21.6 percent in 2012. Put another way: Consumers overall now have more access to free checking. Story by Karen Weise for Bloomberg Businessweek.
Ex-Credit Card Addict Aims to Help Others Kick Habit
Beverly Harzog was an accountant. Shouldn’t she have known better about her credit card spending? But she fell in the trap so many people do. The credit card offers came at the beginning of her career and she responded by accepting them without fully understanding the burden she was building for herself. Harzog was about $20,000 in credit card debt. Her cathartic tale, “Confessions of a Credit Junkie: Everything You Need to Know to Avoid the Mistakes I Made”, might help you fess up and do something about it. Harzog went to work on the debt. It took her two years to pay it off. The journey was life-changing. She ended up leaving her corporate finance job to become a financial journalist specializing in credit cards. Story by Michelle Singletary for the Washington Post.
“Couponing” with Credit Cards
Couponing has been around for decades, but it became a very popular fad after shows like Extreme Couponing and Extreme Cheapskates highlighted the amount of money you can save with the practice. If you are an avid couponer, you may not have considered the financial benefits of “couponing” with a credit card. You may be able to save a significant sum of money each year by using a credit card in a prudent way. Let’s take a look at how the principles of couponing can apply to credit cards. Story by Bill Hardekopf for LowCards.com.
Little-Known Credit Card Perk Can Save You Big
One of the best reasons for paying for a purchase with a credit card instead of a debit card or cash is the power it gives you to dispute charges. If there is a problem with a purchase you’ve charged — you were billed the wrong amount or you didn’t get what you ordered — all it takes is a simple letter, phone call or perhaps even a few clicks online to launch an investigation. Story by Gerri Detweiler for MSN Money.
GE to Reimburse Consumers Misled Over Credit Cards
The U.S. consumer financial watchdog ordered a General Electric Company unit to refund up to $34.1 million to customers who it said were misled about healthcare credit cards. The Consumer Financial Protection Bureau said GE Capital Retail Bank’s CareCredit unit signed up consumers for credit cards that were marketed as interest-free. Actually, the cards accrued interest that could kick in at the end of a promotional period. The credit cards, sold at some 175,000 offices of doctors and dentists around the country, accrued interest at a rate of 26.99 percent that was charged to the borrower in full if there was any balance on the card at the end of a promotional period, regulators said. Many patients did not receive any paper copy of the credit card agreement but instead relied on staff at healthcare offices who were themselves sometimes confused about the terms of the cards. Story by Aruna Viswanatha 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 14.47 percent, slightly higher than last week’s average of 14.42 percent. Six months ago, the average was 14.30 percent. One year ago, the average was 14.32 percent.