LowCards.com Weekly Credit Card Update–March 27, 2020

LowCards.com Weekly Credit Card Update–March 27, 2020

March 27, 2020         Written By Bill Hardekopf

Here’s How Hard the Coronavirus Shutdown Will Bite the Big Credit Card Lenders
As identified coronavirus infections increase rapidly in the U.S., the biggest economic effects will be felt months from now. Still, analysts at Oppenheimer have projected that five U.S. credit card lenders will remain profitable in 2021, despite a large increase in loan losses. Analysts expect losses to ‘materialize meaningfully’ starting in the fourth quarter. Story by Philip van Doorn for MarketWatch

How to Prepare for Job and Income Loss
In the wake of the COVID-19 pandemic, many Americans now find themselves without work, with reduced income, or with no income at all. Approximately two-thirds of Americans say their personal finances have been impacted by the coronavirus, and 48% are worried about potential medical bills. The sudden loss of a job or income can be stressful and unsettling, but there are some steps you can take to protect yourself moving forward. Story by Lynn Oldshue for LowCards.com

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Debit Cards May Be Used for Stimulus Payments 
The IRS wants to issue as many stimulus payments electronically as it can, and a top congressional aide says that should begin in a matter of weeks. The agency will also issue paper checks to some people, though that will take longer because the Bureau of the Fiscal Service, the government office that actually makes the payments, can only process so many so quickly. Because policymakers want to issue the payments as fast as possible, the IRS is exploring whether it would be quicker to issue some payments on debit cards, instead of sending checks. Story by Brian Faler for Politico

Getting Stimulus Funds To Those Who Need Them Without The Paper Check 
The stimulus bill designed to combat the economic ravages of COVID-19 is massive. Getting that aid into the hands of affected families–wracked by swelling unemployment numbers, and of course, an ongoing healthcare crisis–will be slow going. Americans with direct deposit account information stored with the Internal Revenue Service, the conduit through which they get refunds, will get those payments within a few weeks after legislation is finalized and signed. That’s about 70 million Americans. The remaining tens of millions will have to wait for the proverbial (paper) check in the mail. Thus far other options to get these urgently needed funds to those who need them, in the digital sense, are not being embraced fully. Story in PYMNTS

Plastiq Raises $75 Million to Help Small Businesses Use Credit Cards More 
Plastiq today announced that it has raised $75 million in venture capital in a Series D round led by B Capital Group. The round brings the company’s total known venture capital raised to more than $140 million. To use Plastiq, users enter their credit card information on Plastiq’s platform. In return, Plastiq will charge you a 2.5% fee and get your bills paid. While Plastiq was started with consumers in mind, SMBs have now accounted for 90% of the revenue. The new financing round will invest in building out features to give SMBs faster services around payments and processing. Story by Natasha Mascarenhas for Tech Crunch

Amid Doom and Gloom, Retail Credit Card Issuer Predicts Quick Recovery 
The rapidly unfolding crisis in the brick-and-mortar retail sector is inflicting collateral damage on the credit card industry, and particularly on lenders that finance Americans’ spending at shopping malls. No card issuer appears more vulnerable than Alliance Data Systems, which had taken a hit from the shift toward online shopping even before the COVID-19 outbreak. Shares in the Columbus, Ohio-based company have fallen by 62% this year, and by more than 50% so far this month. Yet, CEO Ralph Andretta expressed confidence that the economic disruptions will be relatively short-lived. Story by Kevin Wack for American Banker

Revolut Finally Launches Debit Card and App in the United States 
Revolut, one of Europe’s hottest fintech startups, is launching in the U.S. The London-based company made a name for itself by consolidating numerous aspects of a user’s financial life into a single mobile app, including a bank account, an investment account that lets users trade stocks, commodities and cryptocurrencies, travel insurance, and more. Revolut calls its app, which is accompanied by a physical debit card, “Financial Super App,” as it aims to let consumers “manage all aspects of their financial life.” Story by Stan Schroeder for Mashable

New Accounting Rules Are Giving Banks a Coronavirus Headache 
Some of the rules introduced to protect banks after the 2008 financial crisis are aging better than others in the 2020 one. European regulators are working furiously with the region’s banks to keep its financial system ticking over as Western economies are hit by the coronavirus shutdown. Many of the regulations forged in the meltdown 12 years ago have proved effective, but there is one clear exception: an accounting change pushing banks to write down loans earlier. Story by Rochelle Toplensky for The Wall Street Journal

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Top Features :All credit types welcome to apply!

Africa Turns to Mobile Payments as a Tool to Curb COVID-19 
Africa is using digital finance as a means to stem the spread of COVID-19. Governments and startups on the continent are implementing measures to shift a greater volume of payment transactions toward mobile money and away from cash, which the World Health Organization flagged as a conduit for the spread of the coronavirus. It’s an option facilitated by the boom in fintech that’s occurred in Africa over the last decade. By several estimates, the continent is home to the largest share of the world’s unbanked population and has a sizable number of underbanked consumers and SMEs. Story by Jake Bright for Tech Crunch

Apple Card’s New Privacy Policy May Offer Second Chance to Rejected Applicants 
Apple Card has a new privacy policy that impacts current customers along with people who have not yet applied for the credit card. The changes are expected to make it easier for Apple’s banking partner, Goldman Sachs, to decide which potential customers are creditworthy. If you apply for Apple Card but don’t get approved, you can opt in to share personal data with Goldman Sachs. That personal data may be used to reconsider your rejected application or to increase your credit limit. Story by Lisa Rowan for LifeHacker

Can Jails Return Inmate Cash in the Form of Fee-Laden Debit Cards? 
A federal appeals court has revived a lawsuit by a jailed protester in Oregon who turned over nearly $31 to her jailers and was repaid upon release with a fee-laden debit card. The lawsuit over the fees alleged conversion, unjust enrichment, violation of the federal Electronic Fund Transfer Act, and violation of the Fifth Amendment’s takings clause. Before contracting with Numi Financial in 2014 to provide the debit cards, Multnomah County, Oregon, spent an estimated $275,000 in annual labor costs to handle inmate cash. Now the county pays nothing and Numi earns revenues from the fees it charges. Story by Debra Cassens Weiss for the ABA Journal

How You Can Protect Your Credit Score During the Coronavirus Pandemic 
In the face of current economic uncertainties surrounding the coronavirus pandemic, though, good credit may have even more impact on your financial health. If you’re already facing financial uncertainty, reach out to your credit card issuer to request assistance; many issuers have personalized solutions for cardholders facing hardship due to the coronavirus outbreak. And if you’re in a position where you’re able to prepare, put your extra funds to good use now to set yourself up for security over the next several months. Here are some ways you can begin to safeguard your credit and deal with the unique challenges of this pandemic’s impact going forward. Story by Kendall Little for Bankrate


About Bill Hardekopf

Bill Hardekopf is the CEO of LowCards.com and covers the credit card industry from all perspectives. Bill has been involved with personal finance for over 15 years. He is a frequent contributor to Forbes, The Street and The Christian Science Monitor.
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