LowCards.com Weekly Credit Card Update–July 10, 2015
Meet AmEx’s PayPal Competitor, Express Checkout
As the war to own the digital wallet continues, American Express is joining the battle with Express Checkout, a new way to pay using your AmEx card online. AmEx Express Checkout is similar to the way PayPal works. If you see an AmEx checkout button when paying for an item with an online merchant, you login using your AmEx online credentials, choose the AmEx card you want to pay with, and the transaction is complete. AmEx will autofill all the shipping and billing information as well. And the card member’s account information is transferred to the merchant securely, says AmEx. As a security protection, each time card members click on the AmEx Express Checkout button on a merchant site, they will be required to login. Story by Leena Rao for Fortune.
MasterCard Pilots Pay-By-Selfie Facial Authentication
Call it a mobile payments idea for the Kardashian age: why not use selfies for payment processing? MasterCard has decided to pilot a program that allows customers to do just that when making online purchases. At checkout, users will be asked to hold up their phone and snap a photo, after which facial recognition software will either allow or disallow the transaction. The facial recognition scan won’t be saved on MasterCard servers; rather, it’s converted into a code for secure transit, which can’t be used to reconstruct a picture of the user’s face once created. The small pilot program will be very limited, involving just 500 customers. But, if all goes well, MasterCard expects a wider release. Story by Tara Seals for Info Security.
EU Files Antitrust Charges Against MasterCard Over Card Payment Costs
The European Union on Thursday filed formal charges against MasterCard, accusing the company of violating the bloc’s antitrust laws by artificially raising the cost of card payments. The charges, which follow a two-year investigation, are the latest step in a series of legal battles between the EU and U.S.-based credit-card companies over fees. A parallel EU investigation into Visa’s card fees, opened three years ago, is ongoing. The probes could lead to fines of up to 10% of global annual revenue, or $950 million for MasterCard, and require the companies to change their business practices. Story by Tom Fairless for The Wall Street Journal.
JPMorgan to Pay $166 Million Over Debt Collection Abuses
JPMorgan Chase will pay $166 million and change credit card collection practices after regulators found that the bank used abusive tactics to collect debts, the CFPB said on Wednesday. The company agreed to resolve claims that its Chase Bank USA and Chase Bankcard Services Inc. units pursued the wrong borrowers, sought incorrect amounts or so-called zombie debt that was too old, or relied on documents with improper signatures. Of the penalties, $136 million settles claims brought by the Consumer Bureau, 47 states and the District of Columbia. The Office of the Comptroller of the Currency imposed a $30 million penalty in a related action, CFPB said. Story by Christie Smythe, Carter Dougherty and Hugh Son for Bloomberg.
Consumers Not Enthusiastic about Digital Wallets
Americans are simply not that enthusiastic about the digital wallet. Despite the development of Apple Pay, Google Pay, Samsung Pay, and a number of other independent digital wallet services, Americans aren’t taking to virtual payments as expected, according to a new study from Gallup. The reports showed 30% of fully engaged consumers used their digital wallets at every possible opportunity during the last 30 days, compared to 12% of indifferent users and 2% of disengaged consumers. 48% of fully engaged customers said they used the wallet in supermarkets, followed by 21% at convenience stores, 27% at department stores, and 25% at specialty stores. Story by Bill Hardekopf for LowCards.com.
Apple Has Filed a Patent for a New Feature that Could Kill Off Mobile Payment Apps
Apple Pay is missing one essential feature that it needs to stop people using other mobile payments apps: person to person transactions. But it looks like Apple is planning to change that. The company just filed a new patent that will let people send money to one another directly from their iPhone’s Wallet, which has replaced the Passbook app. Story by Lucy England for Business Insider.
Credit Card Breach at a Zoo Near You
Service Systems Associates, a company that serves gift shops and eateries at zoos and cultural centers across the United States, has acknowledged a breach of its credit and debit card processing systems. Several banking industry sources told KrebsOnSecurity they have detected a pattern of fraud on cards that were all used at zoo gift shops operated by Denver-based SSA. The company declined to name the individual locations that were impacted by the breach, but financial industry sources say the breach likely involves SSA concession and gift shops at zoo locations in at least two dozen cities. Story by Brian Krebs for Krebs on Security.
Gen X, Baby Boomers See Credit Cards as a Lifeline
Generation X, weighed down by debt, is unfortunately growing accustomed to the burden. Gen Xers–and their older, Baby Boomer peers–see credit cards as a lifeline, according to a new study. Of the 1,000 Gen Xers age 35 to 48, and 1,000 Boomers ages 49-67 surveyed, 48% say that credit cards now function as a financial survival tool. That reliance on debt is particularly troublesome for younger Americans, who often put off saving for retirement and other needs because of it. Story by Charisse Jones for USA Today.
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 14.65 percent, slightly above last week’s average of 14.62 percent. Six months ago, the average was 14.46 percent. One year ago, the average was 14.48 percent.