LowCards.com Weekly Credit Card Update–September 26, 2014
Walmart Prepares to Offer Low-Cost Checking Accounts
Here comes Wal-Bank. After years of thwarted efforts to break into banking, Walmart is making its biggest foray yet into everyday financial services. Walmart, the nation’s largest retailer, is teaming up with Green Dot, known for its prepaid payment cards, to supply checking accounts to almost anyone over 18 who passes an ID check. Story by Hiroko Tabuchi and Jessica Silver-Greenberg for The New York Times.
In Checking Accounts, The Less You Have, The More You Pay
Financial complexity doesn’t happen only on Wall Street. Even a basic checking account is often no longer simple, because account rules and fees can vary widely–so widely, in fact, that the annual cost can range from zero to more than $700, according to the 2014 survey of checking account costs by WalletHub. The general rule is that the less money you hold in a bank, the more you pay the bank in fees. The biggest fees fall on consumers who overdraw their accounts, a common practice among less-well-off customers, whom WalletHub calls “cash strapped.” People in this category typically don’t have credit lines or savings accounts to cover them when their balances drop below zero, and their fees add up. Story by Anna Bernasek for The New York Times.
Banks and Consumers Increasingly Use Text Alerts to Fight Fraud
With cyber-crooks grabbing credit and debit card numbers by the tens of millions, there is growing interest among consumers in fraud alerts sent to their smartphones and other devices. After all, no one knows better than a cardholder if a purchase is legitimate. The alerts can arrive in a matter of seconds. Given a heads-up alert, consumers may be able to scuttle unauthorized purchases. They certainly can detect the first time their cards are compromised or block online transactions before products are shipped. Story by Martin Moylan for MPR News.
43% of Companies Had a Data Breach in the Past Year
A staggering 43% of companies have experienced a data breach in the past year, an annual study on data breach preparedness finds. The report, released Wednesday, was conducted by the Ponemon Institute, which does independent research on privacy, data protection and information security policy. That’s up up 10% from the year before. The absolute size of the breaches is increasing. Despite the rise in breaches, 27% of companies didn’t have a data breach response plan or team in place, though that’s down from 39% who didn’t have them in the previous year’s survey. Story by Elizabeth Weise for USA Today.
Data Breach at 216 Jimmy John’s Locations
Jimmy John’s is the latest company to suffer a major data breach. The sandwich shop chain confirmed today that criminals hacked into their point of sale systems at 216 stores and accessed customer debit and credit card information. The breach took place between June 16 and September 5. Hackers obtained the account numbers on these cards, and may have access to the cardholder name, verification number and/or expiration date. Story by Bill Hardekopf for LowCards.com.
Consumer Watchdog Agency Collecting Financial Data on Millions of Americans
The Consumer Financial Protection Bureau collects sensitive financial data on tens millions of Americans, and it needs to do more to protect the information, according to federal auditors. The Government Accountability Office said in a report this week that the bureau gathered information on 75 million credit-card accounts, 10.7 million credit reports, 5.5 million student loans and a range of other financial products over the past two years. The information is used to guide rule-making efforts, provide reports to Congress and “detect risks in consumer financial markets.” Story by Josh Hicks for The Washington Post.
Fraudulent Transactions Surface in Wake of Home Depot Breach
A large data breach at Home Depot has started to trigger fraudulent transactions that are rippling across financial institutions and, in some cases, draining cash from customer bank accounts, according to people familiar with the impact of the hacking attack. The fraudulent transactions are showing up across the U.S. as criminals use stolen card information to buy prepaid cards, electronics and even groceries, these people said. Story by Robin Sidel for The Wall Street Journal.
Why Twitter and Facebook Suddenly Want to Handle Your Money
As trends go, this one is hard to miss. In the space of a recent week, both Twitter and Apple made major announcements about payments—i.e. how we buy things online and in real life. Twitter has just rolled out a “buy” button, which appears alongside certain tweets and allows users to make purchases directly through Twitter with just a click or two. Apple, meanwhile, unveiled Apple Pay at its iPhone 6 event. The new mobile wallet app will allow users to “tap and pay” with their iPhones at more than 200,000 brick-and-mortar stores in the U.S., as well as execute online purchases. At the same time, Facebook has been beta-testing its own “buy” button, which shows up next to posts and ads, allowing users to complete a purchase without ever leaving the network. Story by Ryan Holmes for The Wall Street Journal.
No Joke–Saturday Night Live Now Offers a Rewards Credit Card
Saturday Night Live, the legendary comedy show now in its 40th season, has introduced a rewards credit card that gives special bonuses for spending money on entertainment. The Saturday Night Live MasterCard features a rewards program where people earn points every time they use their card. Cardholders can earn two points for every $1 spent on entertainment purchases, four points for every $1 spent on Saturday for entertainment purposes, and one point per $1 spent on all other purchases. The points can be redeemed for exclusive SNL memorabilia, SNL content, travel tickets, gift cards and merchandise. The card is issued by Comenity Bank. Story by Lynn Oldshue for LowCards.
The Debit Card Danger You’re Probably Forgetting
What makes debit cards so appealing is also what makes them riskier than credit cards. Unlike fraudulent credit card charges, fraudulent debit card purchases draw real money from your bank account. That’s money that you can’t use to make a rent payment or car payment or to buy new shoes for your kid. There’s no guarantee that your money will ever be replaced, especially if you wait too long to report the fraud. Federal law says you are only liable for $50 in fraudulent charges if you tell your bank within two business days of learning about them. Wait more than those two days, but fewer than 60 calendar days after you receive your statement, and you can be liable for up to $500 in losses. Beyond that length of time, there are no limits. That’s not all. Even if you do get all your money back, it probably won’t happen that same day. It might not even be that week. Story by Matt Schulz for U.S. News.
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 14.53 percent, slightly higher than last week’s average of 14.51 percent. Six months ago, the average was 14.47 percent. One year ago, the average was 14.38 percent.