LowCards.com Weekly Credit Card Update–December 2, 2016
How Much is a Batch of Stolen Credit Cards Really Worth?
You don’t have to be a bank to make money on credit cards. A hacker can make between $250,000 and $1 million by selling a batch of 50 to 100 credit card numbers. A shrewd buyer can then turn those stolen card numbers into between $2 million and $8 million, though the risk of getting caught is higher for the buyer than the seller. Those are the findings of a study this year by a research team led by Michigan State University criminologist Thomas Holt. Victims and banks have long known that someone who steals a credit or debit card number can ring up thousands of dollars in charges in almost no time. But Holt and his colleagues are among the first to examine the crime and its profits at the wholesale level, where hackers steal batches of numbers and then offer them for sale in online forums. Story by John Wisely for the Detroit Free Press.
Mastercard Uses Artificial Intelligence for Transaction Approval
Credit card company Mastercard is introducing artificial intelligence (AI) into its global network to provide more effective transaction approval. The company has introduced Decision Intelligence, a service that uses artificial intelligence to learn from every transaction it monitors. Decision Intelligence will replace the systems that focus on risk assessment based on pre-defined rules. Mastercard wants to reduce the number of transactions wrongly declined while retaining high security. Decision Intelligence examines how a specific account is used over time to detect normal and abnormal shopping spending behaviour. According to Javelin Strategy & Research in the US, the value of false declines is more than 13 times the total amount lost to actual card fraud. Story by Karl Flinders for Computer Weekly.
American Express Raises Its Fee for Late Payments
If you carry an AmEx card, better make your payments on time. The federal government is raising the allowable limit on some credit card late fees, and American Express is the first big issuer to act. Starting in January, AmEx will charge customers as much as $38 if they are late on more than one payment in a six-month period. That’s $1 more than the company’s old highest fee, and it will put AmEx at the maximum allowed under the Consumer Financial Protection Bureau’s updated guidelines. Late fees were capped by the 2009 Card Act, which cut into penalty-fee revenue for U.S. card issuers. The card industry is eager to get it back. Issuers are spending more money to court new customers with pricey rewards programs and other promotions. Story by Robin Sidel for The Wall Street Journal.
Can Walmart Keep Up Its Game Of Chicken With Visa?
Two of the biggest companies doing retail business in Canada are at war with each other: Visa and Walmart. Most Canadians have not noticed, though, because the war is taking place only in select markets. However, if the current trend continues, it could be, as the slogan goes, coming soon to a store near you. The issue is fees. Walmart is famous for beating down supplier prices on everything from clothing to home furnishings. That’s its business model, that’s what it has to do to appeal to its core market. Walmart claims that Visa’s fees in Canada are too high. Back in May, negotiations broke down between the two companies. Walmart announced that it would phase out Visa payments in all its stores across the country. That phase-out began in Thunder Bay, where Walmart has three stores. Thunder Bay? Could Walmart have chosen a more secluded spot? If Walmart had started with Toronto, that would have been like dropping a retail nuclear bomb. Story by David Leonhardt for Huffington Post Canada.
Madison Square Garden Reveals Year-Long Credit Card Breach
Madison Square Garden was the victim of a widespread credit card breach that lasted for nearly a year. According to a company statement, the credit card processors at Madison Square Garden, the Theater at Madison Square Garden, Radio City Music Hall, Beacon Theater, and Chicago Theater were compromised between November 9, 2015 and October 24, 2016. The breach did not impact the companies’ websites or digital ticket sales-only the card readers at the physical locations. Not all cards used during this time were affected by the breach, only those with magnetic strips-not smartchips. The hackers were able to gain access to credit card numbers, expiration dates, cardholder names and verification codes for some of the cards used at these locations. Only those who bought food, drinks or other items at concessions were affected. People who bought tickets for sporting events, performances or concerts at the box office, on the MSG websites or on Ticketmaster were not affected. Story by Bill Hardekopf for LowCards.com.
Debit Card Fraud Losses for All Parties Rose 44% From 2013 to 2015
Debit card fraud cost banks, merchants and consumers $2.41 billion in 2015, a 44% increase over the previous two years, the Federal Reserve said in a report released Wednesday. The biennial report details the costs and losses card issuers incur in processing debit-card transactions, and how those costs stack up against the fees banks charge merchants to process the transactions. Congress capped those fees as part of the 2010 Dodd-Frank law-a provision known as the Durbin amendment-and the Fed now limits them to roughly 21 cents per transaction. Wednesday’s report said 99% of debit card and prepaid card transactions in 2015 were processed by card issuers whose costs were less than the Fed’s swipe fee limit. The Fed also found that 66% of issuers covered under the rule-banks with more than $10 billion in assets-had average debit card costs and fraud losses below the swipe-fee limit last year. That is slightly higher than the share of banks with costs below the limit in 2013. Story by Kate Davidson for The Wall Street Journal.
Here’s Why You Might Want to Skip Those Offers for Store Credit Cards
It’s Black Friday and the holiday season is in full swing, so you’ll undoubtedly be asked more than once whether you’d like to open a store credit card account and get a discount on your purchase. My advice: Don’t. Or at least think twice before taking the plunge. Unless this is your absolute favorite store in the whole world, it’s possible you’ll do more harm than good by sticking another piece of plastic in your purse or wallet. And store cards can come with some really ugly terms. Story by David Lazarus for The Los Angeles Times.
The Digital Wallet is Set to Exceed Debit & Credit Card Payments
The technology of today allows us, and our devices, to be more connected than ever before. This offers the opportunity for financial software to disrupt the traditional format of Banking in a pervasive and long lasting way. We are specifically talking about the digital wallet and how it is set to become the method of choice over and above cash and debit and credit card payments. A digital wallet is an electronic device such as your phone that can be used to make transactions. The account credentials are transmitted to the merchant using near field communication (NFC) in exactly the same way you would tap your debit card to make a contactless payment. This can also include other useful information such as your identity and date of birth. The payments market is huge, with Accenture estimating that cash and card payments made globally each year total US$13 Trillion. Contactless payments have seen a huge growth rate of 300% each year within Europe. So what is it about digital wallets that make them so attractive? Story by Angela Scott-Briggs for Tech Bullion.
Gift Card Exchanges Can Save You up to 35%
Savvy shoppers can buy gift cards at steep discounts using online marketplaces, such as Cardpool, Gift Card Granny and Raise, to pay for holiday gifts. Raise estimates that consumers will save more than $40 million this holiday season through buying discounted gift cards on its platform alone. The amount you save depends on the popularity of the brand. The more popular or ubiquitous the merchant, the lower the discount. For example, you can buy a Target gift card at Gift Card Granny with a 5.6 percent discount as of Nov. 22. By contrast, you can purchase a card for New York & Company, a wear-to-work clothing retailer for women, at 35 percent off face value at Cardpool. The discounts on cards at online exchanges are based on supply and demand. Story by Tom Anderson for CNBC.
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 14.75 percent, slightly higher than last week’s average of 14.70 percent. Six months ago, the average was 14.72 percent. One year ago, the average was 14.63 percent.