LowCards.com Weekly Credit Card Update–June 19, 2015
Almost One in Six US Consumers are Using Mobile Wallets
Almost one in six US consumers (15%) have used a mobile wallet in the past six months, up from 9% in the same period in 2013, and an additional 22% are likely to adopt mobile wallet functionality in the coming six months. Some 18% of the 1,716 consumers surveyed for The Mobile Wallet in 2015 and Beyond report said they are “very familiar” with mobile wallets, compared to 8% in 2013, while 44% said they are “somewhat familiar” compared to 42% in 2013 and 37% said they were “unfamiliar,” a decrease from 50% two years previously. Among mobile wallet users, 61% have used PayPal with an average 88% satisfaction rate, 38% have used Amazon (84% satisfaction), 31% have used Starbucks (93% satisfaction), 31% have used Apple Pay (89% satisfaction) and 31% have used Google Wallet (82% satisfaction). Story by Rian Boden for NFC World.
Virgin Money Makes Sex Pistols the Face of its Credit Cards
Sir Richard Branson is reconnecting with his punk rock roots in order to sell credit cards. Virgin Money, the credit card company founded by the British billionaire, is offering U.K. consumers the chance to carry a card featuring art from the Sex Pistol’s 1977 classics: “Never Mind the Bollocks” and “Anarchy in the U.K.” Branson, who got his start in the music business, signed the seminal punk band to his Virgin Records label in the 1970s after seeing them perform at a London club. Branson says he owes much of his success to the Sex Pistols, who he credits for inspiring other bands like the Rolling Stones, to join his record company. Story by Ben Rooney for CNN Money.
MasterCard Announces Tokenization Support for Private-Label Cards
MasterCard announced that it has become the first payment network to provide tokenization services to private label (store-branded) credit card issuers, enabling merchants to take advantage of the latest digital payment innovations. BJ’s Wholesale Club, Kohl’s and JCPenney will be among the first retailers to bring mobile payments to their private label cardholders later this year, according to a press release. All three retailers now are involved with forthcoming Apple Pay updates this fall. MasterCard also has announced partnerships with some of the largest private label credit card issuers in the U.S., including Synchrony Financial and Citi Retail Services, to enable consumers to use their eligible credit cards within participating mobile payment and digital wallet services. Story in Mobile Payments Today.
Discount Chain Fred’s Probes Card Breach
Fred’s Inc., a discount general merchandise and pharmacy chain that operates 650 stores in more than a dozen states, disclosed that it is investigating a potential credit card breach. KrebsOnSecurity contacted Fred’s earlier this week, after hearing from multiple financial institutions about a pattern of fraud on customer cards indicating that Fred’s was the latest victim of card-stealing malware secretly installed on point-of-sale systems at checkout lanes. Sources said it was unclear how many Fred’s locations were affected, but that the pattern of fraudulent charges traced back to Fred’s stores across the company’s footprint in the midwest and south, including Alabama, Arkansas, Georgia, Indiana, Kentucky, Louisiana, Mississippi, Tennessee and Texas. Story by Brian Krebs for Krebs on Security.
Discover Closes Mortgage Sector in Favor of Direct Banking
Discover Financial has decided to close its mortgage sector to focus on its direct banking products. The transition will leave approximately 460 employees without work, though Discover will provide them with a severance package. Discover Home Loans was established in 2012 after a business acquisition, and it will continue to operate under a new owner – AmeriSave Mortgage Company. Discover will be accepting loan applications until July 31, and the Louisville headquarters will be in operations through early August. AmeriSave will finish processing the remaining applications at that time. Story by Bill Hardekopf for LowCards.com.
Apple, Google and Samsung Bet on Walletless Future
Despite early resistance from retailers and even consumers, momentum is now building toward making these tap-and-pay systems a widespread consumer habit. Apple this week announced enhancements to Apple Pay, which was introduced in the fall, and Google said it will soon launch Android Pay, its Google Wallet successor. Amazon dropped out of the digital wallet race earlier this year but could return. Samsung is about to enter the market after buying Massachusetts-based LoopPay in February. Story by Matt OBrien for Top Tech News.
MasterCard, Capital One: Why the Stocks Will Surge
There are many reasons to believe credit card companies will continue to charge ahead. In the U.S., consumers may still feel wary of debt after the pain of the Great Recession, but that hasn’t stopped them from swiping their cards: Revolving credit, reflecting mostly credit-card debt, climbed at an annual 11.57% rate in April, the second-largest increase since 2009. That’s part of a larger trend that’s been playing out for decades, as both Visa and MasterCard have seen purchase volume on their U.S. credit cards soar well over 100% since 2000 as consumers take on more debt and increasingly use plastic over cash. We’d highlight two in particular: Inexpensive Capital One Financial, which focuses on the domestic market, and industry heavyweight MasterCard, for exposure to global growth. Story by Teresa Rivas for Barron’s.
Foolish Credit Card Mistakes Travelers Make
58% of Americans take at least one vacation per year. And they’ll spend a lot of money to do so. 42% said they planned to spend $1,500 or more on their next trip. Many travelers who hit the road this summer will be paying with plastic for everything from plane fares to restaurant meals. Credit cards make travel easier in many ways. You don’t have to worry about carrying large amounts of cash, finding an ATM, or fumbling with traveler’s checks (remember those?). But credit cards pose risks for vacationers as well. The biggest danger is overspending, a trap that 60% of people fall into. You may decide to splurge on extras while traveling, but you’ll end up paying for it after the trip is over. Not fun. And that’s not the only way that credit cards can trip up travelers. Here are five more credit card mistakes people should avoid while on vacation. Story by Megan Elliott 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 14.60 percent, identical to last week. Six months ago, the average was 14.46 percent. One year ago, the average was 14.52 percent.