LowCards.com Weekly Credit Card Update–October 28, 2016
Credit Card Scammers Flock to Online Shopping
Just like legitimate shoppers, criminals are buying more goods and services online with credit cards. The rate of online card fraud is rising sharply as a growing number of purchases take place on the internet while brick-and-mortar merchants race to lock down vulnerabilities in the checkout line. That is prompting new steps to try to curb the threat: The credit card industry on Tuesday announced a plan to encourage online merchants to provide card issuers with more detailed customer information that could be used to catch fraudulent purchases. More than 7.5% of online merchants’ revenue is eaten up by the cost of actual fraud and costs associated with fraud-prevention tools, according to a new survey. Story by Robin Sidel for The Wall Street Journal.
What Mobile Carriers Do Next: Become Banks
If banking is something you do on an app, why shouldn’t your mobile carrier actually be your bank? It’s more than just an idea. Orange, Telenor, and O2 are all building their own operations. In the UK alone, people use mobile banking apps more than 7,610 times a minute, or 4 billion times a year. All over the world people are switching away from branch-based banking, and even desktop Internet banking, to manage their financial lives through an app. Why wouldn’t they? There’s no need to go anywhere. The user interface is typically better than it is on a PC. And the addition of biometrics (typically fingerprint) makes signing in so much easier and safer than passwords. Of course, banking apps are made by banks. The carriers just provide the data packages that allow people to use use them. But in the last year, a small number of European carriers have come to a radical conclusion: Let’s do more than just enable mobile banking apps; let’s build our own. Story by Rimma Perelmuter for Venture Beat.
No One Wants a Wells Fargo Credit Card. Good.
Wells Fargo’s recent earnings report signaled deep trouble for the scandal-plagued bank. Profits were down, revenues flat, and, perhaps even more worrisome, the bank announced fewer people were opening accounts. Credit card applications, for instance, declined by 20% compared to a similar period in the previous year, and bank account interested declined by a quarter. Which is great news! Wells Fargo, despite its status as one of the nation’s largest retail banks and its cutthroat desire to pair consumers with as many banking products as possible, has consistently offered borrowers lackluster credit card options, vastly inferior to its rivals. You are better off shopping elsewhere for your piece of plastic. Story by Taylor Tepper for Money.
Credit Card Worries Weighing on Consumers
Student loan debt has been a growing concern over the last three years, as the outstanding loan total has surged past $1 trillion. But is it the biggest financial worry consumers have? Not by a long shot. A new poll conducted for the National Foundation for Credit Counseling has found that credit cards are the biggest financial worry for consumers, and other concerns aren’t even close. When asked what financial issue caused them the most worry, 69% of consumers said credit cards. The second biggest worry concerned the inability to save for retirement or emergencies, mentioned by 13% of consumers. Student loan debt was third, at 10%. Story by Mark Huffman for Consumer Affairs.
Uber Offers its Own Debit Card to Mexican Customers
Don’t have enough Uber in your life? Sign up for an Uber debit card. The ride-hailing company is launching a debit card available to Uber Mexico customers. The Uber Bankaool debit card, released in partnership with Mastercard and the Mexican online bank Bankaool, will work as a regular debit card for in-store purchases, e-commerce and ATM withdrawals. The card represents an effort by Uber to attract more customers in Mexico, where some debit providers don’t allow e-commerce purchases like Uber rides. Story by Emma Hinchliffe for Mashable.
Credit Card Fraud in the U.S. Topped $8 Billion in 2015
The U.S. is responsible for more than a third of the world’s credit card fraud. While fraud losses incurred on all credit, debit and prepayment cards reached $21.84 billion last year, losses in the U.S. accounted for $8.45 billion, or 38.7% of the total volume, according to the Nilson Report. At the same time, the nation generated just 22.9% of global purchase and cash volume. Total credit card fraud losses grew by 20.6% over the last year, outpacing volume, which clipped upward by only 7.3%. They resulted in $15.72 billion in losses to card issuers, while merchants and acquirers lost the remaining $6.12 billion. Most losses to credit card companies occur from counterfeit cards used at point of sale or ATMs. The report notes the best defense against fraud is using chip cards, which now handle nearly 36% of Visa, Mastercard, Union Pay, Discover/Diners, JCB and American Express transactions worldwide. In the U.S., chip cards accounted for less than 2% of total fraud. Story by Kerry Close for Money.
Once Millennials Are Denied Credit, They May Not Be Back
Millennials may give up on obtaining credit once they’ve been declined. In fact, 6 in 10 will not apply for credit for at least a year following a denial. The study also found Millennials are often declined for credit due to a lack of credit history or low credit scores-even when they have the ability to repay the debt. While they may be easily discouraged, Millennials are still applying for credit at higher rates than GenXers or Baby Boomers. Millennials also make up a larger number of credit card applicants (35%) than marketplace loan applicants (28%), which indicates that Millennials are interested in traditional credit cards. The problem seems to be that fewer than half of Millennials have credit scores high enough to be approved for a credit card with a mainstream lender. One-third do not have a credit history, and for those that do, two-thirds have subprime or non-prime credit scores. Story by Bill Hardekopf for LowCards.com.
Mastercard Connects Your Car to Your Wallet
Mastercard is partnering with General Motors and IBM to enable cars to remind users to run errands–and let them pay from the car, without opening their wallet. The collaboration will bring Masterpass secure, payment technology and Mastercard Digital Enablement Services to a new cognitive mobility platform called OnStar Go, which will be embedded across many GM vehicles starting in 2017. By embedding Masterpass within OnStar Go, Mastercard will enable drivers and passengers to safely make secure and seamless payments for goods and services using credit or debit cards stored within their Masterpass wallet. Story in IT Online.
Bank of America’s Newest Tech: Siri-Like Service for Mobile Customers
Bank of America unveiled on Monday a Siri-like “virtual assistant” for smartphones, the latest example of the industry’s deepening push into mobile banking. The bank said the feature, called Erica, will allow its customers to perform transactions 24 hours a day, seven days a week using their voice. The technology, unveiled at a payments industry conference in Las Vegas, works similar to other smartphone virtual assistants such as iPhone’s Siri. A spokesperson said the bank becomes the first among its competitors to offer the feature. The bank unveiled other new mobile-banking technology, including upcoming access to a person-to-person payment service meant to compete with Venmo and other popular money-transfer apps. Banks’ customers are flocking to smartphones to conduct transactions they used to rely on branches for. Also, mobile transactions can cost a bank less than the same transactions performed in a branch, increasing the attractiveness of the technology as banks seek to lower overall expenses. Story by Deon Roberts for the Charlotte Observer.
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 14.60 percent, identical to last week. Six months ago, the average was 14.76 percent. One year ago, the average was 14.56 percent.