LowCards.com Weekly Credit Card Update–July 21, 2017

July 21, 2017, Written By Lynn Oldshue

U.K. Bans Credit Card Surcharges, Calling Them A ‘Rip-Off’
British retailers will be forbidden from forcing customers to pay surcharges when they use a credit card, under new rules announced by the U.K.’s Treasury Ministry on Wednesday. “Rip-off charges have no place in a modern Britain,” said Economic Secretary to the Treasury Stephen Barclay. British consumers sometimes face steep surcharges for using a credit card—as much as 20 percent for purchases such as airfare, the Treasury says. The new rule, which takes effect in January, will also apply to government agencies. The government also said it will look at doing more to limit the costs of processing payments that credit card companies impose on retailers. Story by Bill Chappell for NPR

Cybercriminals Can Take A Class On Stealing Credit Cards
Credit card information is valuable, and for criminals who want to learn how to find and use it, there’s a class for that. One six-week program, taught in Russian, includes lectures on finding legitimate credit card data for sale and hacking into PayPal accounts. It’s more in-depth than other trainings, like PDFs that criminals can buy much cheaper. The class, which costs about $945 with the materials, consists of 20 different lectures and allows the students to chat with the instructors. Carding is a popular type of cybercrime. Thieves will steal credit card data from insecure databases, by hacking into companies or just buying it on the dark web on hidden sites you wouldn’t find with a Google search. Digital Shadows estimates $24 billion will be lost to credit card fraud next year. Criminals can also take emails and passwords leaked from other data breaches, and test them on banking websites. Story by Selena Larson for CNN

U.S. Data Breaches Hit A Record High
Data breaches in the United States have hit a half-year record high, according to a new study from the Identity Theft Resource Center and CyberScout. In the first six months of 2017, an estimated 791 data incidents occurred throughout the country, 29% more than 2016. Based on the mid-year report, the ITRC predicts more than 1,500 total breaches will take place in 2017, which would be 37% higher than last year. A record 1,093 reported breaches took place in 2016. In order to truly understand how damaging these incidents are, analysts need specific information about the number of records affected by the breach. Unfortunately, 76% of notifications from this year’s data breaches have not included the number of records impacted. There are no regulations that currently require this information. Story by John Oldshue for LowCards.com

Republicans Introduce Bills To Scrap New Bank Arbitration Rule
Republican lawmakers in the House and Senate have introduced bills calling for the repeal of a just-announced regulation that would make it easier for consumers to bring class-action lawsuits against banks. The rule unveiled last week by the Consumer Financial Protection Bureau would ban banks and other financial institutions from using arbitration clauses to block customers from bringing or joining class-action suits. Republicans had immediately pledged to unwind the rule before it takes effect next year. Banks and other companies often include language in consumer contracts that forces customers to resolve disputes in private arbitration rather than in court. The CFPB rule would allow that practice to continue, but would ban arbitration clauses that also ban consumers from bringing class-action suits. Such suits allow consumers who have suffered relatively minor harms to join together to hold a big bank accountable and to bring bad practices to light. Story by James Rufus Koren for the Los Angeles Times

Mastercard Expanding Scan-To-Pay QR Program
Mastercard is expanding its QR-based programs to create greater choice in retail mobile payments. The company plans to offer QR codes for scan by customers and merchants. The solution will enable customers to pull up a QR code on their smartphone that can then be scanned by the merchant. Masterpass QR, launched in 2016, already enables brick-and-mortar shoppers to pay for their purchases using their mobile phones rather than a plastic card: They can simply scan the QR code displayed at the merchant’s point of sale, or enter a text code if their phone doesn’t have a camera. This new solution shifts the scanning responsibility from the customer to the merchant. Once the QR code has been scanned, the online payment will be processed through the Mastercard network using M/Chip technology and the secure EMV infrastructure that retailers already have in place. Story in PYMNTS

Banks Have Raised Credit Card Interest Rates But Not Savings Account Rates
If it feels like your savings account is only earning you pennies, you’re probably right. There are better places you could be parking your cash. Since the fourth quarter of 2015, the Fed’s target interest rate has risen 100 basis points, and credit card rates have risen 53 basis points during that same time frame, according to an analysis of more than 2,200 accounts by WalletHub. Every rise in 100 points translates into about a 1% increase on products with APRs, such as credit cards. In theory, the rise in rates should translate to savings accounts too. But they have been slow to do it. Interest rates on checking accounts at banks that have branches have risen just 8.85 basis points. And savings accounts at banks that have branches have actually dropped 0.79 basis points. Story by Maria LaMagna for MarketWatch

PayPal Strikes Deal With Visa For Debit Cards In Europe
PayPal and Visa have entered into an agreement that will see the internet payments giant issue debit cards in Europe. The two firms have signed a deal to collaborate in offering payment services across Europe. Card companies have been struggling with the pressure from PayPal’s meteoric rise, so this new deal will likely take some of the heat off Visa. PayPal, which already has a banking license in Europe, will be able to offer users PayPal-branded Visa debit cards. The firm has mainly used its license for treasury functions until now, but the agreement will give it a broader customer base. The move will mark a first for PayPal, which already offers debit cards in the US and some prepaid card services (with Mastercard) in Italy. Story in IBS Intelligence

Didn’t Pay Your Macy’s Bill? Expect A Text From Citigroup
When consumers have trouble making ends meet, bills from retailers that have gone bankrupt or closed tend to go toward the bottom of the pile. The trouble for lenders like Citigroup is that the debt is actually owed to them. Citigroup, the fourth-largest U.S. bank by assets, said on Friday that it is having trouble collecting on store-branded cards, which is leading to higher losses. To reverse that trend, the bank has been stepping up its outreach to shoppers who finance purchases from chains like Macy’s and Sears with Citigroup store-brand credit cards which the bank has stood behind for more than a decade. The bank recently doubled the number of text messages it sends to borrowers. Story by David Henry for Reuters

How to Make Your Credit Card Act Like a Debit Card
Young adults these days are wary of credit cards. Yet building credit is important to qualify for loans for major purchases like a car or home. Debitize, an online tool that will be available as a mobile app later this summer, works to convert a credit card into a sort of debit card with benefits. The idea is that users can build credit and get the perks that come with many credit cards, while protecting themselves from getting mired in debt. First, customers need both a checking account and a credit card. Then, they register online for Debitize and link both the bank account and the card to the tool. Debitize then tracks credit card spending and pulls cash from your checking account when you make purchases using the credit card. The money is held in a separate Debitize account, and the tool pays the credit card bill automatically when it’s due. The basic service is free. Story by Ann Carrns for The New York Times

PayPal, J.P. Morgan Chase in Deal to Expand Mobile Payments
Two of the highest-profile companies providing mobile wallets in the U.S., J.P. Morgan Chase and PayPal will now be partners as well as competitors under terms of a new deal set to be announced Thursday. The agreement is expected to help broaden the reach of J.P. Morgan’s Chase Pay service, a smartphone application the bank launched last year to drive usage of its credit and debt cards for in-store and internet purchases. The deal, which is expected to be fully rolled out by 2018, will also make it easier for customers to load their J.P. Morgan cards into PayPal’s rival application and let them use their reward points to pay for goods and services through PayPal. Story by Peter Rudegeair for The Wall Street Journal

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 15.45 percent, identical to last week. Six months ago, the average was 14.90 percent. One year ago, the average was 14.70 percent.

 



The information contained within this article was accurate as of July 21, 2017. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.


About Lynn Oldshue

Lynn Oldshue has written personal finance stories for LowCards.com for twelve years. She majored in public relations at Mississippi State University.
View all posts by Lynn Oldshue