LowCards.com Weekly Credit Card Update–June 30, 2017

LowCards.com Weekly Credit Card Update–June 30, 2017

June 30, 2017         Written By Lynn Oldshue

America is Hooked on Credit Cards and It’s Pretty Clear Why
Americans have racked up $1.01 trillion in revolving debt—primarily credit card debt—according to the Federal Reserve. That’s the highest tally since the financial crisis in 2008. The credit card is now the preferred method of payment among Americans, edging out debit cards and cash, according to the 2016 US Payment Study by payment processing company Total Systems Services, or TSYS. It’s the first time credit cards claimed the top spot in the six years TSYS has been conducting the study. Why have credit cards grown more popular? The study offers some insights as to why. Story by Alex Morrell for Business Insider

Why New Lower Credit Card Limits Can Hurt You, And What To Do In Response
Ownership of credit cards is at a 10-year high, according to the latest Industry Insight Report from TransUnion. That includes record ownership by those whose credit scores are less than stellar, and for those card-owners there’s often a catch. Banks are issuing more credit cards to people with bad credit scores, but they’re tightening their purses in a way that limits the utility of those cards. Specifically, they’re dialing down the average credit limit—the maximum amount an account can carry—for people with credit scores below 600, the market’s so-called “subprime borrowers”. A key driver for that reduction has been an increase in card delinquencies. The tightened limits, sometimes only in the hundreds of dollars, make it more difficult for subprime consumers to dig out of their credit hole, and even threaten to make their subprime status perpetual. But they can also push down the credit scores of even new card holders who will be diligent in making payments on their card. This is because smaller limits make it more likely that consumers will utilize more of their available credit. Story in Nasdaq

The Credit Card Rewards War Rages. Are You the Loser?
Credit or debit? For routine purchases, Americans are likelier to say debit. U.S. card issuers would prefer a different answer. Credit brings in far more revenue. First, the banks charge higher “interchange fees,” fees paid by merchants, on credit card purchases. Then, if you don’t pay off your credit card, the issuer levies interest and finance charges. So what’s their strategy for getting you to use the credit card? Temptation. Issuers have loaded up their high-end credit cards with travel perks and other rewards. Still, there are dangers to chasing credit card rewards. Reward cards charge annual fees that can exceed $500 a year. They also tend to charge higher interest rates than other cards. Story by Ben Steverman for Bloomberg

Buckle Stores Hit by Security Breach
Buckle stores that its in-store payment systems had been compromised and that some customers’ card information may have been taken. Buckle said some credit and debit cards used in stores between Oct. 28, 2016, and April 14, 2017, may have been compromised. The company said it does not believe data was collected from all transactions or all point-of-sale systems for each day within the time period. Through its investigation, Buckle found that the store payment systems were infected with malware, or a form of malicious computer code, designed to record payment information, including account number, the account holder’s name and expiration date. Buckle said it doesn’t think any social security numbers, email addresses or physical addresses were recorded. There’s also no evidence that Buckle.com customers were affected. Story by Paige Yowell for the Omaha World Herald

Enhancing Prepaid Cards with Remote Deposits
For several years, prepaid and stored value cards have been among the hottest growth stories in the payments landscape. Nearly 10 billion purchases were made using these cards in 2015, an increase of more than 67 percent since 2009. Even as the growth of “closed loop” cards limited to a defined group of retailers has moderated, interest in general purpose cards that can be used anywhere non-prepaid debit cards are accepted is still growing. Many times, however, users won’t reload prepaid cards, discarding them once their initial value is depleted, and this has long been a barrier to their usefulness. This poses business model challenges, not only because of the increasing expense of manufacturing prepaid cards but also because of the lost opportunity to nurture long-term relationships with stored-value card holders. Until recently, crediting mobile check deposits to prepaid card balances was deemed too risky, and immediate funds availability was out of the question. However, new technologies now allow for real-time decisioning about holds on these deposited items. Story by Louise Steller for Cues

The ATM at 50
Fifty years ago this week, consumers’ lives changed. While at one time, they could only receive cash during their banks’ business hours, on June 27, 1967, a machine was born in London that fixed that. The first ATM debuted in London. John Shepherd-Barron became frustrated when he arrived a minute after a bank closed one Saturday. He brought his idea to the British bank Barclays, which jointly developed a cash machine with De La Rue Instruments. It took about two years to make it, and it debuted in Enfield, in north London. Since then, the “cash machines” eventually known as ATMs, or automated teller machines, have spread across the world. Story by Maria LaMagna for MarketWatch

Mobile Banking Transactions to Double by 2020
Figures out today from two different sources indicate that mobile banking transactions will more than double by 2022, while branch visits may dwindle to as little as just four visits each year for the average consumer. The research, published by CACI, reveals that customer interactions with their bank will increase by 54% in the next five years – largely driven by the continued rise of mobile banking. Banking app transactions will increase by 121%, meaning that log-ins, balance checks and payments will more than double. Interactions made using a laptop or desktop, claims the report, will decrease by 63% between 2017 and 2022, as more and more consumers switch to smartphones to carry out transactions. Story in IBS Intelligence

Mastercard Offering Merchants New Payment Tools
Mastercard Developers has released several new APIs (application program interfaces) to give merchants and other companies access to more than 40 proprietary products and services to enable payments on new platforms. For example, the Masterpass Chatbot API is being used by FreshDirect, Subway and The Cheesecake Factory to create payment-enabling chat bots on Facebook Messenger, Mastercard said. Also, Uber and Lyft are using on-demand payroll services powered by Mastercard Send to help drivers quickly collect pay. Story by Dan O’Shea for Retail Dive

This Gorgeous $250 Ring Can Replace Your Wallet, Your Keys, and Even Your Train Pass
In Token’s world, you’ll never need to carry your wallet. You won’t need house keys, or a transit pass, or even to remember your computer password. All you’ll need is a ring. Token is a fledgling hardware company that just introduced its first product: the Token ring, an identity ring designed to store your credentials and secure your privacy with a fingerprint sensor. The Token ring starts at $249 and is now available for presale. The first Token rings will start shipping in December. Story by Avery Hartmans for Business Insider

There’s Now an Apple Pay Smart Debit Card for Kids
Greenlight is a special debit card and service that allows families to monitor and control how and where kids can spend money. Starting today, Greenlight’s smart debit card for kids will work with Apple Pay as well. With Greenlight, the money you give your child is divided into two categories: money they can Spend Anywhere, and money they can spend only at a store you’ve approved in advance. We call these permission-based spending opportunities “a greenlight.” When the debit card is used by someone without permission or over the spending limit, it will be declined and an alert will be sent to the family. Kids can always view spending power in their own app as well. Greenlight debit cards can be used internationally in over 120 countries after initially being limited to transactions in the US. Greenlight is also turning on Apple Pay support for kids who can add the smart debit card to Apple’s Wallet service on the iPhone, iPad, Apple Watch, and Mac. Story by Zac Hall for 9 to 5 Mac

Apple Pay Now Widely Accepted at Five MLB Ballparks
Appetize announced it has launched its modern point-of-sale solution at five Major League Baseball stadiums, including Angel Stadium in Anaheim, Comerica Park in Detroit, Coors Field in Denver, Kauffman Stadium in Kansas City, and Yankee Stadium in New York City. While some of the ballparks already accepted Apple Pay to a limited extent, Appetize’s technology extends Apple Pay widely to concession stands, team merchandise stores, and other new areas. The NFC-enabled terminals also support other EMV-based payment options such as Chip-and-PIN cards and Masterpass. Appetize said wait staff will also be using its iPad mini-based handheld point-of-sale solution for in-seat ordering and delivery. Story by Joe Rossignol for Mac Rumors

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 15.43 percent, slightly lower than last week’s average of 15.46 percent. Six months ago, the average was 14.90 percent. One year ago, the average was 14.68 percent.


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
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