LowCards.com Weekly Credit Card Update–February 12, 2016
The IRS Says Identity Thieves Hacked Its Systems Again
Identity thieves attempted to breach computer systems at the Internal Revenue Service to file fraudulent tax refunds. The criminals were especially after E-file PINs, which are used by some individuals to electronically file a return, the agency said in a statement released Tuesday. Around 464,000 unique social security numbers were involved, and of that total, 101,000 SSNs were used to successfully access an E-file PIN. The thieves used personal taxpayer data that was stolen elsewhere to help generate the PINs, the agency said. No personal data was compromised or disclosed by IRS systems, and affected taxpayers will be notified by mail of the attack. Story by Jonathan Chew for Fortune.
The Sharing Economy is Doing Amazing Things for Mobile Payments
Over the past few years, the sharing economy has gone from something that a few tech-savvy idealists were excited about to a fundamental part of our everyday lives. Companies such as Uber, Airbnb, and Instacart, have all ridden this boom to become massive companies with global operations. Interestingly, they’ve brought mobile payments technology with them. That’s hardly surprising. Many of these companies depend on customers being able to make reliable mobile payments in order to survive. And when you consider PwC’s estimate that the global sharing economy will grow from $15 billion in 2013 to $335 billion in 2025, you get an idea of just how much potential growth there could be for mobile payments tech in the same period. Story by Stuart Thomas for Memeburn.
Agencies Under Fire for Credit Card Use
Legislation to crack down on how federal agencies use their government-issued credit cards appears to be gaining steam in Washington. The Senate last year unanimously passed legislation from Sen. Tom Carper (D-Del.) that would create tighter oversight of the cards, partly in response to a May report that found cardholders in the Department of Defense had spent more than $100,000 at casinos and strip clubs. The legislation would establish a new office, the Office of Federal Charge Card Analytics and Review, charged with keeping close tabs on the purchases made by federal agencies and programs. As of now, finding out just how much money the government spends on credit and prepaid cards is difficult to discern. A spokeswoman in the Government Accountability Office told The Hill it didn’t have any records on card transactions to share. Carper’s bill could change that by creating a clearinghouse for such information. Story by Lydia Wheeler for The Hill.
Credit Card Debt Is Rising At Its Fastest Pace Since 2008
The U.S. economy sputtered into the end of last year, but consumers were charging into the new year, with credit card debt rising at the fastest pace in more than seven years. Consumer credit outstanding, which includes all consumer borrowing outside of mortgages, rose by annualized $21.27 billion in December to $3.55 trillion, according to Federal Reserve data. Economists had expected $16.5 billion. Revolving credit, which is mostly credit card debt, rose by $5.84 billion after rising $6.36 billion in November. Year over year, revolving credit rose 5.1%, the fastest gain since October 2008, when the financial crisis was at its peak. Story by Ed Carson for Investor’s Business Daily.
The Millennial Money Habit That Defies Logic
Last month, the Federal Reserve Bank of Philadelphia published a report that looked at millennials’ money habits, particularly their use of banks and alternative financial systems. While some findings were hardly a surprise-younger consumers are most likely to use peer-to-peer lending and alternative payment systems like PayPal and Venmo-the report found one big head-scratcher of a trend. Millennials, even those earning high incomes, are exceedingly fond of general-purpose reloadable prepaid cards. The conventional wisdom around these cards is that they are used mostly by low-income and unbanked populations, and people who distrust big banks. But the majority of millennials have access to conventional credit and debit cards; in fact, according to the report, 83% of millennial prepaid card users also have debit cards. And 60% of “millennials with money” (household incomes of $100,000+) report using prepaid cards. On the face of it, that doesn’t make much sense. Story by Ethan Wolff-Mann for Time.
Fear of Fraud in Online Payment Luring Customers to Prepaid Cards in India
An overwhelming 88 per cent Indians are concerned about the security of online financial transactions and at least a quarter refrain from making payments online for fear of fraud, says a survey done by prepaid ecommerce firm ValuAccess.The survey that covered 3,200 buyers said 47 per cent use their credit card as the preferred mode for payment followed by 34 per cent for cash on delivery and 17 per cent through net banking. Over 60 per cent of the respondents were below 30 years of age and 72 per cent of them were male. Movie tickets and electronics and gadgets was what they bought most online. ValuAccess believes the anxiety over fraud and the young demographic population of the users would pave the way for growth in the prepaid or gift card category. Story by Sumant Banerji for Business Today.
Visa Allows Users to Block Unauthorized Card Transactions
Visa is giving consumers better control over their credit, debit, and prepaid card accounts by allowing cardholders to temporarily block unauthorized transactions with their smartphones. The feature, known as Visa Consumer Transaction Controls, is available to financial institutions that issue Visa cards, and it can be incorporated into the bank’s mobile app, mobile wallet or website. In addition to blocking transactions, the new consumer controls allow users to put a block on their accounts if their cards have been lost or stolen. This feature is designed to minimize issues that may arise from identity theft, and makes the process of cancelling a card number much more convenient for consumers. Consumers can also use the new feature to set spending limits on their accounts. Story by John Oldshue for LowCards.com.
MasterCard on Investment Spree; is the Future Bright?
In an attempt to expand its market share, MasterCard Inc. (NYSE:MA) recently announced a deal with Banc of California for the bank’s debit cards. The deal with MasterCard will help Banc of California to offer debit cards customized for its customer base. The card issuer entered into a deal with JetBlue Airways Corporation and Walmart Stores, Inc. for digital payment services provided by MasterPass. Earlier in January, MasterCard extended its business relationship with Walmart through its MasterPass. The card issuer will continue to provide payment solutions to the retail giant; Walmart in 2016, according to an executive at MasterCard. Moreover, MasterCard entered an agreement with Desjardins Group in January, one of the largest credit union in Canada. Story by Abdul Wasay for Bidness Etc.
What’s Next In Mobile Banking?
How much do Main Street Americans love their mobile phones? A lot, it seems. A new study from Bain & Company on consumer banking trends makes an illustrative point on the topic of people, their cell phones and their own financial lives. According to the study, 50% of Americans surveyed say they would rather lose their wallet than their mobile phone. That number rises to 79% in China and South Korea, Bain adds. That attachment to mobile phones is certainly impacting how consumers bank, and how they view their banking experiences. For example, Bain reports that a routine interaction on a mobile app “is 32% more likely to delight customers than a routine interaction in the branch. Moreover, frequent mobile users said they are 40% less likely to switch banks than customers who rarely use banks’ mobile apps.” To delve into this trend more deeply, several industry experts provided a look ahead at what’s popping up this year in mobile banking. Story by Brian O’Connell for The Street.
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 14.83 percent, a slight decrease from last week’s average of 14.85 percent. Six months ago, the average was 14.68 percent. One year ago, the average was 14.40 percent.