Weekly Credit Card Update July 1, 2010

July 1, 2010, Written By sitemanager

DISCOVER POSTS PROFIT AS CREDIT CARD USE JUMPS
Discover Financial Services returned to profitability in its fiscal second
quarter as consumers spent more with their credit cards. The company also said the rate of accounts in early delinquency continued declining. Discover put aside $724 million for bad debt in the quarter–44 percent less than last year. Discover card sales volume grew 6 percent to $23 billion, a sign that consumers are gaining confidence in their financial situations. The company says improving consumer credit will continue to push earnings upward.

Story by Candice Choi for the Associated Press.

http://www.google.com/hostednews/ap/article/ALeqM5jz4O08-wCIE0lfwd0walJOzEZQjwD9GI074O0

DELINQUENCY RATES FALL ON CONSUMER DEBT
Consumers in the United States are taking on less debt than they did before the recession, even though fewer of them are falling behind on their loans. Delinquency rates on mortgages, home equity loans and credit cards fell in May for the fourth straight month, according to data that Equifax Inc, one of the largest U.S. credit bureaus. Outstanding balances on bank-issued credit cards have fallen 13.2 percent to $726 million in May. That is lower than they were in May 2007. Lenders are being more cautious as well. Banks today issue an average of 2 million credit cards per month, down by about two-thirds from 2006 and 2007.

Story by Helen Chernikoff for Reuters.

http://www.reuters.com/article/idUSTRE65N3KY20100624

INTERCHANGE FEE REGULATIONS: WHO WINS, WHO LOSES?
The financial overhaul bill could pass both houses of Congress this
week. One of the major elements of this bill is the proposed change
in the interchange fee for debit cards. This change could significantly benefit retailers, but hurt banks and possibly harm consumers. How will interchange regulations on debit cards affect consumers, retailers and banks?

https://www.lowcards.com/blog/category/credit-card-press-releases/

VISA CAN TAKE CREDIT FOR THIS SLY DEBIT CARD BILL
IN CALIFORNIA AND OTHER STATES
It is time to check your wallet when Visa, the purveyor of credit and debit cards, turns populist and puts its muscle behind a bill that is supposedly friendly to consumers. Like Long Beach state Sen. Jenny Oropeza’s bill, Senate Bill 933. The credit card giant is orchestrating a lobbying effort here and in no fewer than 10 other states, among them Vermont, New York, Illinois and Colorado. Each would bar merchants from charging fees when customers use debit cards, which could mean big bucks for Visa. Businesses absorb costs whenever they process a debit card or a credit card. Why shouldn’t businesses have the latitude to pass such costs onto customers if they so choose? If California lawmakers wanted to save consumers a few bucks, they too could tackle credit and debit card fees. Maybe they could try to limit banks from charging fees when people use automatic teller machines. But that would take years of study and hearings. Legislators don’t have the time these days.

Story by Dan Morain for the Sacramento Bee.

http://www.presstelegram.com/opinions/ci_15390157

AFTER REFORM, BANKS STILL MAY NOT LEND MORE
While Washington moves ahead on reforming the nation’s financial system, bank lending appears to be going nowhere fast. Many banks have been reluctant to make new loans in recent months, in part, because of uncertainty about just how harshly lawmakers would crack down on the industry. But last week’s ironing out of a Wall Street reform bill may do little to revive the flow of credit. But these aren’t the only reasons why banks may still be reluctant to lend more. Troubling economic numbers like last week’s sharp decline in new home sales may keep bankers nervous as they try to manage their current loan losses.

Story by David Ellis for CNN.

http://money.cnn.com/2010/06/29/news/companies/regulation_lending/

CHASE OFFERS SMALL BUSINESS RATE CUTS IF THEY HIRE
JP Morgan Chase said it will lower the interest rate charged on a line of credit to small business customers by half a percentage point for every new hire they make, for up to three hires. The program applies to new
lines of credit up to $250,000, or existing business customers who
increase their lines of credit by $10,000 or more.

Story by Matthias Rieker at Dow Jones.

http://online.wsj.com/article/BT-CO-20100629-713817.html

LOWCARDS.COM WEEKLY CREDIT CARD RATE REPORT
Based on the 1000+ cards in the Lowcards.com Complete Credit Card
Index, the average advertised APR for credit cards this week increased
to 13.63%, up from 13.60% last week. Six months ago, the average was 13.13%. One year ago, the average was 12.10%.

https://www.lowcards.com/ratereport/credit-card-rate-report.asp

UNEMPLOYMENT EXTENSION REJECTED;
AMERICANS MAX OUT CREDIT CARDS
After multiple attempts to pass an unemployment extension have failed,
unemployed Americans have turned to, and maxed out, their credit to
help pay for bills. The Senate met this week to vote on an unemployment extension, but Senate Democrats were unable to obtain enough votes. Democrats needed 60 votes to approve an unemployment extension bill. As unemployed Americans continue to lose faith in the U.S. government, many are turning to their credit cards to cover part of their expenses.


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The information contained within this article was accurate as of July 1, 2010. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.