LowCards.com Weekly Credit Card Update–May 8, 2020

LowCards.com Weekly Credit Card Update–May 8, 2020

May 8, 2020         Written By Bill Hardekopf

Credit Card Use Dives in March by Most Since 1989
Revolving credit, like credit cards, fell $28.2 billion, or 30.9% annual rate in March. That’s the biggest percentage decline since January 1989. Weaker personal income growth and rapid job losses kept consumers from using credit in March. Total retail sales fell a record 8.7% in March as the economy was shut down to stop the spread of coronavirus. A Fed survey of senior loan officers reported tightening lending standards and weakening demand for credit cards and auto loans. Story by Greg Robb for MarketWatch

Credit Card Issuers Start to Lower Cardholder Limits
It appears that everyone is tightening their belts during the coronavirus pandemic, even credit card companies. A new survey has found that about 25% of card owners in the US had their limits reduced or accounts closed within the past 30 days. Almost 50 million people saw their credit limits decreased or cards closed involuntary, according to a CompareCards survey conducted in late April. Those affected were split almost evenly among Generation Z, millennials and Generation X. Credit card issuers tend to lower limits or close accounts to reduce their risk, especially in a financial crisis like the one happening across the globe. Story by Oscar Gonzalez for CNet

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Why Using All Your Credit Cards Now Will Protect Your Finances
Unusual times call for unusual advice, which is why I’m now saying something I never expected to while doing my job: Go out and use all of your credit cards. Before you start thinking I’ve lost my mind after weeks of social distancing alone in my work cave, let me explain that the advice has nothing to do with racking up debt and everything to do with protecting your available credit and credit score. Use all of your credit cards, especially the ones you normally don’t. When times get tough, lenders go turtle. Banks and credit-card issuers aren’t taking all new credit offers off the table, but they are cleaning up their books. Story by Chuck Jaffe for the Seattle Times

Now You Can Check Your Credit Files Once a Week for Free
The three major credit-reporting agencies are making it easy for you to track what’s happening to your credit history in real time. You can now access your credit files for Equifax, Experian, and TransUnion once a week through April 2021. Before, you could only do that for free every 12 months. Your credit file isn’t a credit score; it’s the information used to generate credit scores. That’s why it’s so important to make sure the data in your files is accurate. Story by Herb Weisbaum for Consumers’ Checkbook

Samsung Will Introduce an ‘Innovative’ Debit Card This Summer
Samsung wants to do more with payments than offer a virtual prepaid card. The company plans to grow Samsung Pay this summer by introducing a new “experience” that includes an “innovative” debit card supported by a cash management account. Details are only slated to arrive in the “coming weeks,” but it’ll have help from the financial startup SoFi. Story by Jon Fingas for Engadget

Select Chase Credit Cards Earn Up to 5x Points on Groceries Through June
If you have a Chase travel card, the card issuer has just added a new reason to keep your card open. Chase travel cards with annual fees now earn either 3 points per $1 or 5 points per $1 on grocery purchases. That includes purchases made in-store and through grocery delivery services, up to a maximum of $1,500 in spending per month. This new rate applies through June 30, 2020, and you don’t need to do anything to activate it. Story by Lyle Daly for The Motley Fool

Citi Announces Changes to Help Cardholders Maximize Benefits During Coronavirus
New cardholders who applied for a Citi credit card between Dec. 1, 2019, and May 31, 2020, will get an additional three months to hit the spending requirement. You’ll get a total of 6-7 months to hit your bonus if you applied (or will apply) between those dates. The extension is automatic. However, this extension is only for the sign-up bonus deadline, not for other promotional intro offers such as a 0% APR offer. Citi is a bit late to the party with this. But it’s still nice to see Citi joining in to help ensure cardholders get the best chance to hit bonus requirements in light of coronavirus concerns and changing spending habits. Story by Madison Blancaflor for The Points Guy

Online Food Orders, Delivery Surge Amid COVID-19 Lockdown
Restaurant traffic declined by 22% in March compared to the same month a year ago. However, as a testament to U.S. consumers’ desires for someone, other than themselves, to make their meals, digital restaurant orders increased by 63% and delivery by 67% in March, according to The NPD Group. Story in Mobile Payments Today

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American Express says COVID-19 Hits Cardholder Spending
American Express says the COVID-19 pandemic has impacted cardholder spending and will force it to pare down costs. Revenue fell 1%, to $10.3 billion in the quarter, compared with $10.4 billion a year ago, reflecting reduced cardholder spending that began in late February. Stephen Squeri, chairman and CEO, said “The deterioration in the economy due to COVID-19 impacts that began during the first quarter and accelerated in April has dramatically impacted our volumes.” Story in Mobile Payments Today

Stripe Adds Card Issuing, Localized Card Networks and Expanded Approvals
At a time when more transactions than ever are happening online, payments behemoth Stripe is announcing three new features to continue expanding its reach. The company announced it will now offer card issuing services directly to businesses to let them in turn make credit cards for customers tailored to specific purposes. It’s going to expand the number of accepted local, large card networks to cut down some of the steps it takes to make transactions in international markets. And finally, it’s launching a “revenue optimization” feature that essentially will use Stripe’s AI algorithms to reassess and approve more flagged transactions that might have otherwise been rejected in the past. Story by Ingrid Lunden for Tech Crunch

Cash Flow is ‘More Important Than Ever’ While PPP Loans Stall. How Small Business Credit Cards Can Help
The federally-funded Paycheck Protection Program (PPP) dried up on April 16 and was replenished on April 24 with an additional $310 billion in forgivable loans — but it still may not be enough. Facing unexpected cash flow issues amid the unprecedented economic downturn, small business owners are scrambling to find resources to help them stay afloat and prepare for what may be years-long economic recovery. Many look to credit cards to mitigate the current dip in revenue. Story by Megan DeMatteo for CNBC


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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