LowCards.com Weekly Credit Card Update–May 12, 2017
Profits From Store-Branded Credit Cards Hide Depth of Retailers’ Troubles
Department stores and big name retailers are increasingly making the hard sell to sign up customers for credit cards at the register. The store cards promise deep discounts on clothing, furniture and electronics, and are tough for shoppers to resist. For some retailers, those credit cards are not just a sales tool, but also an essential way to bolster their struggling businesses–a trend that has worrisome implications for the industry and its customers. The store cards, with steep interest rates that are often twice that of the average credit card, generate a rich profit stream for retailers at a time when many of America’s traditional retailers are losing the battle for sales against Amazon and other e-commerce rivals. Those profits on plastic are helping obscure the true extent of the industry’s pain, a major pressure point for a piece of the economy that employs one in 10 Americans. Story by Michael Corkery and Jessica Silver-Greenberg for The New York Times.
Chase Is Offering 100,000 Credit Card Rewards Points For New Mortgage Customers
This has to be one of the most expensive ways to pick up some credit card points. Chase announced it is offering 100,000 Chase Ultimate Rewards points to its customers who have Sapphire, Sapphire Preferred or Sapphire Reserve credit cards if they open a mortgage with Chase. The offer will be available through August 6 to customers who had any Chase Sapphire card as of May 7. Chase’s credit cards have been popular in recent months, particularly the Sapphire Reserve card, which debuted in 2016 and initially offered a 100,000-point sign-up bonus, which was later reduced to 50,000 points. Credit card experts estimate some 900,000 people signed up for that card between September 2016 and November 2016. Now, Chase is attempting to capitalize on the young consumers it captured with that card. Half of Chase Sapphire customers are millennials, who may be looking to buy their first home soon. Story by Maria LaMagna for MarketWatch.
Subprime Borrowers Find It Easy To Get Credit Cards
Good credit? Bad credit? It hasn’t mattered much these days when it comes to credit cards now that the financial crisis and recession are far behind us. We’re looking at the greatest number of credit card carrying consumers since 2005, according to a TransUnion report. More than 171 million consumers had access to a credit card at the end of the first quarter. Nearly 22 million additional consumers were able to pull out plastic early this year compared with 2010. The rebound in credit card access–and credit card debt–has been fueled, in part, by lenders easing credit to higher-risk consumers now that the economy and jobs picture have improved. The rate of growth for subprime consumers was 8.9% in the first quarter of 2017, a much faster clip than other risk tiers. Story by Susan Tompor for The Detroit Free Press.
New App Will Stop You Using Your Debit Card While Drunk
A new mobile payments system promises to stop users from overspending when they’re drunk. DrnkPay, developed by financial services consultancy iBe TSE, is an app that connects your credit and debit cards to either a breathalyzer or biosensor. Before a night out, users set up the app by selecting how many drinks they plan to have, which DrnkPay converts to units of alcohol. Then, before every purchase, users have to blow into the breathalyser, finding out how close they are to their limit they are before they get to the bar. Those who don’t want to carry a breathalyser around can opt to use a Quantac Tally biosensor wristband, which measures alcohol diffusion through the skin. Story by Adam Boult for The Telegraph.
Current Debit Card Gives Parents Control Over Their Kids’ Spending
With credit cards and digital wallets on smart devices it’s easier than ever to go cashless. But there’s one group that still relies on the cash economy: kids. To make it easier for parents who struggle to come up with the cash when chores are completed or allowance time rolls around, Current has released an app-controlled Visa debit card designed to make it easy to give children some money and teach them good saving habits in the process. Current looks and operates like a regular debit card, but the associated app grants parents a lot more control over their child’s spending. Parents are able to set up a recurring allowance transfer to their child’s Current account, or send one-time payment for completing certain chores. All these transactions are recorded. Once there’s money in the account, the child is able to use it like a regular Visa debit card. If there are certain things the parent doesn’t want their kid spending money on–alcohol or gambling, for example–they can use the app to block spending on that specific thing. The card can also be locked remotely. Story by Scott Collie for New Atlas.
The Republican Effort To Scrap Rules On Prepaid Debit Cards Has Failed
Republican efforts to scrap Obama-era rules governing prepaid debit cards have failed, according to the Georgia Senator leading the push. Throwing out the rules depended on the use of a fast-track legislative process that could not be blocked by congressional Democrats. But that process came with a Thursday deadline, and Republican Senator David Perdue says the bill will not clear the Senate in time. Prepaid debit cards are now used by an estimated 12 million primarily low-income Americans, and in recent years the Consumer Financial Protection Bureau has moved to bring similar rules to the cards as those that apply to traditional debit cards and checking accounts. The Bureau’s rules, finalized last year, require clear disclosure on fees and hidden charges, limitations on late fees and overdraft fees, and protection against fraudulent transactions. Republicans, led by Sen. Perdue, have been heavy critics of the CFPB and vowed to overturn its rules using a law that allows for speedy repeal of regulations passed in the final months of a previous administration. Story by Matthew Zeitlin for Buzz Feed News.
Square Is Rolling Out Its First Debit Card
Last month, Jack Dorsey teased the launch of a Square debit card. Today, the company started allowing some users of its Square Cash money-transfer service to order one of these cards for themselves. A Square spokesperson confirmed that the company started sending out invites to some Square Cash users today. The prepaid card isn’t linked to your bank account, but instead to the Square Cash app. That means you can only use it to spend money that you are holding in your Square Cash account. Why would you want to do that? Perhaps if someone sends you money through the service and you want to spend it that day. (Square charges a 1 percent fee to instantly deposit new funds to your bank account; otherwise, you may have to wait a day to access the funds.) Perhaps you don’t have a bank account at all. Story by Jason Del Rey for Recode.
Spotify Partners With Capital One To Offer Half-Price Premium Subscriptions
In an effort to grow its paid subscribers base, Spotify this morning announced a partnership with Capital One that will offer Spotify customers half off the price of their Spotify subscription if they pay with a Capital One Quicksilver or QuicksilverOne cards. The year-long partnership will conclude on April 30, 2018 and will be applicable to all the Premium tier memberships Spotify offers. This includes the standard Premium membership which is $9.99 per month, as well as the student and family plans. Given that a full year of Spotify Premium typically costs $120, the deal means that cardholders would save $60 a year by using their Capital One card, or as much as $90 if paying for a Spotify Premium Family membership. Story by Sarah Perez for Tech Crunch.
Mobile Banking Apps Now Let You ‘Turn Off’ Debit Cards To Fight Fraud
More and more mobile banking apps are allowing users to remotely disable their debit and credit cards to combat fraud. This week, British banking giant Barclays joined those ranks when it debuted new security features for the Barclays mobile app, with around 5 million British users, including the ability to disable online purchases and reduce ATM withdrawal limits. Across the pond, competitors like Bank of America, JPMorgan Chase and Ally Financial Inc. already offer similar features where mobile app users can disable stolen or jeopardized debit cards. It looks like it won’t be long until remote locking is considered a standard component of online banking. Story by Leigh Cuen for International Business Times.
Citi Gets Katy Perry On Board For Its Double Cash Card Promos
Credit card giant Citi has had plenty of success with its Double Cash ads. The campaign positioned Citi Double Cash as a card that is straightforward. The tag asking; “Wouldn’t it be great if everyone said what they meant?” reinforces the card’s cash back offering of 1% unlimited on purchases and another 1% as cardmembers pay for those purchases. Now, pop superstar Katy Perry is on board to help promote the card with a new TV spot. The TV spots will be appearing across an array of networks including ESPN, USA, E!, Discovery, Lifetime, HGTV, FX, and AMC during popular programs such as The Bachelorette, Dancing with the Stars, Billboard Music Awards and others. Story by Kyle O’Brien for The Drum.
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 15.26 percent, identical to last week. Six months ago, the average was 14.65 percent. One year ago, the average was 14.75 percent.