LowCards.com Weekly Credit Card Update–May 22, 2020

LowCards.com Weekly Credit Card Update–May 22, 2020

May 22, 2020         Written By Bill Hardekopf

Millions of Americans Skip Credit Card and Car Payments
Millions of people are behind on their credit-card and auto-loan payments, the latest sign of the coronavirus pandemic’s financial devastation. Lenders in April had nearly 15 million credit cards in “financial hardship” programs, such as deferral programs that let borrowers temporarily stop making payments, according to estimates by credit-reporting firm TransUnion. That accounts for about 3% of the credit-card accounts the company tracks, TransUnion said Wednesday. Story by AnnaMaria Andriotis for The Wall Street Journal

Nearly 17% of Consumers Owe More Than $10,000 on Credit Cards
According to a May survey from U.S. News & World Report, a majority of Americans are carrying credit card debt. More than 15% of respondents are carrying between $2,500 and $9,999. Almost 17% of respondents are carrying more than $10,000 of credit card debt. A little less than 36% haven’t carried debt on credit cards in the past year. Many Americans have debt on multiple credit cards. About 19% juggled debt on two to four credit cards while more than 4% have revolved balances on five or more cards. Story by Beverly Harzog for US News & World Report

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Mastercard Brings Priceless Experiences Lineup Online
Mastercard is bringing its “Priceless experiences” to the digital world by offering online experiences to cardholders as they hunker down at home during the pandemic. The online events series is hosted by Mastercard global ambassadors, including acoustic sessions with musician Camila Cabello, cooking tutorials with professional chefs and a Q&A session with rugby star Bryan Habana and tennis player Naomi Osaka. Cardholders can access the Digital Priceless Experiences platform at Priceless.com. The site includes a library of content to help people browse and connect to their passions while at home. Story by Dianna Christie for Marketing Dive

How Covid-19 is Changing Credit Card Marketing
The pandemic’s impact on the economy and on consumer behavior is shifting what appeals to people looking for the best credit card deals. Travel card miles can be saved up for future trips, but being able to use them today on Amazon with a discount has immediate appeal. Marketing evolution will play out on a stage of tighter credit standards as conditions worsen. Story by Steve Cocheo for The Financial Brand

Under New Rules, Banks Will No Longer Earn Civil Rights “Brownie Points” for Pushing Families into Credit Card Debt
There are lots of laws that dictate what banks aren’t allowed to do, but only one law asking banks to make a positive difference in their communities: the Community Reinvestment Act, passed in 1977. The CRA requires banks to lend to low and moderate income people: an important goal, given how few Americans could afford to buy a house or start a business without access to credit. But in the decades after the CRA was initially passed, banks realized they could use credit cards to meet some of the law’s requirements. Under rules released Wednesday by the Office of the Comptroller of the Currency, credit cards and checking account overdrafts will no longer earn banks any community reinvestment brownie points. Story by Elena Botella for Forbes

PayPal Rolls Out QR Codes for Touch Free Transactions
PayPal is offering consumers the ability to pay with in-app QR codes across 28 different international markets, a move that gives a safer way to make payments through the company’s mobile wallet. PayPal is temporarily waiving its standard seller transaction fees on QR code transactions. Story in Mobile Payments Today

The Coronavirus is Upending Cash Economies. Mobile Money Could Emerge as the Winner
In the United States and elsewhere, mobile money services like Apple Pay, Google Pay and PayPal, along with its subsidiary Venmo, are rising in popularity by offering mobile wallets that allow users to send money digitally. A similar model has taken off in developing countries, particularly in Africa, targeting those with no or limited access to the banking and financial system. Experts and members of the industry say the pandemic is likely to escalate that trend. Story by Miriam Berger for The Washington Post

Marriott Gets $920 Million in Card Deals with Amex, Chase
Marriott raised $920 million in cash through deals with co-branded credit card companies as it rides out the pause in travel due to the coronavirus. Marriott, the world’s largest hotel company, will get $570 million from JPMorgan Chase & Co. in prepayment of future revenues and the early payment of a previously agreed to signing bonus. The company is also getting $350 million from American Express in a prepurchase of loyalty points through Marriott’s Bonvoy program. Both deals include extensions of existing co-branding agreements. The move comes as hotel companies hoard cash to ride out a public health crisis that has had a major impact on the travel industry. Story by Patrick Clark and Jennifer Surane for Bloomberg

Featured Fair Credit Card
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Amex Appears To Have A New Four Credit Card Limit
All the major card issuers have different restrictions when it comes to approving people for new cards. This is to limit their exposure, encourage profitable behavior, etc. In light of the current situation we’re seeing banks largely tighten up credit, so we’ve seen some new restrictions added. It looks like Amex may have just added one such restriction. Amex seems to have officially confirmed a new restriction on Twitter, claiming the limit is four total consumer and business lending cards. Story by Ben for One Mile at a Time

California Is About To Mail First Batch of Debit Cards To Immigrants Needing Pandemic Relief
A state program to help immigrants through the pandemic is starting to send out cash aid this week. The Coalition for Humane Immigrant Rights of Los Angeles, or CHIRLA — one of a dozen community organizations helping the state process applications — said it was mailing out the first batch of debit cards on Thursday. The Disaster Relief Assistance for Immigrants fund was set up for immigrants who don’t qualify for unemployment or federal stimulus money because they aren’t in the U.S. legally, but are losing jobs just as other workers are. Story in LAist

Treasury Using Prepaid Cards to Speed Delivery of Stimulus Payments
Nearly 4 million Americans are expected to receive their federal stimulus payments soon on prepaid debit cards. The plastic cards, issued by Sioux Falls, S.D.-based MetaBank, should speed up delivery of federal stimulus payments to unbanked households or those whose bank account information is not on file with the Internal Revenue Service. Paper checks were expected to take weeks or even several months to arrive in the mail. Recipients of the prepaid cards will be subject to certain fees, including a $2 charge for out-of-network ATM withdrawals in the U.S. and a $5 fee for cash withdrawals from banks. Story by Kevin Wack for American Banker

Mastercard Launches Anti-Fraud Measures at Gas Pumps
Mastercard announced a series of consumer protections aimed at protecting customers and merchants from fraud at fuel stations. The company said fraud was up 17 percent at gas pumps through the end of last year through its EMVcredit card terminals that allow chip cards and smart cards. The enhanced consumer protection program was designed to provide merchants and banks with tools to help them navigate the heightened risk of fraud. Banks that issue Mastercards will receive data on high-risk transactions to enable them to tailor their authorization decisions accordingly and prevent fraud before it occurs. Story in PYMNTS

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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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