LowCards.com Weekly Credit Card Update–January 8, 2016
Coin and MasterCard Want to Make Everything You Wear a Payment Device
Coin has primarily been known for making one of the first “smart” credit cards that can switch between multiple cards. That hasn’t worked out so well, but it has meant that Coin has learned a thing or two about how to integrate payment systems into hardware. So the company is teaming up with MasterCard to help other companies integrate mobile payments into their fitness devices, or smart watches, or jewelry, or clothing – basically anything and everything that can fit an NFC chip inside it. Story by Dieter Bohn for The Verge.
Citibank Testing Card-Free ATM Machines with Iris Scanning
Thanks to new developments in biometric technology, Citibank is testing a set of ATMs that do not have screens, pin pads or card readers. The machines are powered by EyeLock iris-scanning technology that verifies a person’s identity based on patterns in their eyes. The new cardless ATMs are designed to work through a mobile app on a customer’s phone. Through a combination of near field communication (NFC) and QR code scanning, the app sends signals to the ATM to process withdrawals and provide other account details on request. Customers do not have to remember their PINs or even have their cards to make withdrawals from the ATM. They simply let the machine scan their eyes for identity verification, and then use the ATM much like they would traditional models. Story by John Oldshue for LowCards.com.
Prepaid Debit Cards Target Niches or Aim to Replace Bank Accounts
When Steve Streit conceived the prepaid debit card, he had something very specific in mind: a way to let kids spend money online without using a parent’s credit card. He didn’t imagine that 16 years later the cards would be used by tens of millions of lower-income Americans to manage their money–or that a bevy of small rivals would offer new products on top of the prepaid system he pioneered. The cards are targeting an assortment of niches–as varied as Uber drivers and business owners who want to restrict employees’ corporate spending. Others have broader business models and are trying to use prepaid products to replace bank accounts, especially for millennials who may have no tied to traditional banks. But unlike Green Dot, which boasts that it invented the prepaid card industry, most new firms are going out of their way to call themselves technology companies, perhaps partly because of the stigma that comes along with the prepaid industry. The cards have long been decried by consumer advocates who argue they come with too many fees and too few consumer protections. Story by James Rufus Koren for the Tribune News Service.
MasterCard Lets You Order Groceries from this Samsung Fridge
You may sneak down to your fridge for a midnight snack. But would you head down at an odd hour to order and pay for the groceries? You’ll be able to do just that if you own the Samsung Family Hub refrigerator launching here at CES, the first connected fridge with a new Groceries by MasterCard shopping app. MasterCard is launching the service in the tri-state New York City market with grocery partners FreshDirect and ShopRite. The app is also integrated with MyWebGrocer, an e-commerce software provider to the grocery industry, enabling additional grocers to transact through the fridge. The Samsung fridge has an embedded 21 ½ inch touchscreen that comes preloaded with the MasterCard grocery app. Story by Edward C. Baig for USA Today.
Fidelity Switches to Visa for Credit Card Branding
Fidelity, one of the few credit card issuers that reward cardholders with a lucrative 2 percent in cash back on every dollar they spend, is making changes to its program. But even as other credit card issuers have cut back rewards, Fidelity’s cardholders need not fear: The generous rewards system will remain intact. Instead, Fidelity is ending a 12-year partnership with American Express, and will offer Visa-branded cards through U.S. Bank. The company said it believed that the new Fidelity Rewards Visa Signature card would be attractive to a wider group of people, including the coveted millennial generation, generally viewed as people born from about 1980 through the ’90s. Visa cards are more broadly accepted by merchants than American Express cards, which was one of the big drivers behind the change. Story by Tara Siegel Bernard for The New York Times.
Higher One Hit With $28.5 Million in Fines, Restitution Fees
Federal regulators hit college financial services provider Higher One with $28.5 million in penalties and restitution charges saying the company mislead student financial aid recipients into improper fees, and other transgressions. Higher One is also sharing with WEX Inc.’s WEX Bank the responsibility for returning $31 million to affected students. The Federal Reserve ordered Higher One to give back to students $24 million in fees, and slapped it with a fine of $2.23 million. The FDIC separately levied a $2.23 million fine on Higher One and ordered it and WEX Bank to share the cost of returning $31 million to students. Story by Ryan Tracy for The Wall Street Journal.
Mobile Payments Did Not Take Off in 2015, But They Will This Year
On the surface, 2015 was the year mobile payment technology hit its stride. Apple, Samsung and Google all launched their own payment apps and it was more common for consumers to use the PayPal app to send money or tap on the Starbucks app to buy coffee. But such scenarios were more the exception than the rule. The reality is that mobile payments are still an emerging technology, and 2015 will be remembered as a year they were proven but not widely adopted. The adoption numbers won’t rise unless the mobile payment paradigm changes. But the good news is that mobile payment apps will break through in 2016. Here are four ways brands can help users warm up to mobile payment apps. Story by Chloe Green for Information Age.
Your Tax Refund May Take Longer, But at Least You’ll Get It
Last year’s income tax season was marked by an explosion of refund theft. Will this year be any different? Increased protections may cut down on fraud but will likely draw out the wait for your money. Changes will be visible when you use tax preparation firms and filing software, with warnings akin to those from your bank if you try to log in from a new device or change account information. Less visible will be broader changes, such as revamped fraud-sniffing programs used by the IRS, states, and the tax prep industry, as well as new information-sharing agreements among all three. Whether these measures will make it appreciably harder for someone to use your identity to claim your refund isn’t clear. One of the best consumer defenses against refund fraud is to file as early as possible, starting Jan. 19, beating would-be thieves who depend on your procrastination. But the best defense is to set your deductions ahead of time so that you get no refund at all. Story by Suzanne Woolley for Bloomberg.
Mobile Banking Threats on the Rise
If you regularly use a mobile banking app on your Android smartphone, you might want to read this. According to the Kaspersky Security Bulletin Overall Statistics Report for 2015, mobile financial threats have entered the top ten list of malicious programs designed to steal money. The report goes on to explain that variants of the Faketoken and Marcher Trojans take residence on your devices and attempt to steal your payment details. Story by Tan Kit Hoong for The Star.
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 14.87 percent, identical to last week. Six months ago, the average was 14.65 percent. One year ago, the average was 14.46 percent.