This Week In Credit Card News: Online Gambling With A Credit Card, Cybersecurity Bill Passed

House Passes Cybersecurity Bill After Companies Fall Victim to Data Breaches

Responding to a series of computer security breaches in government and the private sector, the House passed an expansive measure Wednesday that would push companies to share access to their computer networks and records with federal investigators. Should the House and Senate come together on final legislation, it would be the federal government’s most aggressive response yet to a spate of computer attacks. [The New York Times]

New Credit Card Code May Boost Legal Online Gambling

A change in the way credit cards are categorized may soon give legal online casinos a significant boost in sales. The state of New Jersey has developed a new Merchant Category Code that separates legal and illegal gambling transactions, giving banks the opportunity to start approving the charges from legal online casinos. Recently, special sanctions were put in place to allow online gambling in New Jersey, Nevada, and Delaware. Under the law, online gambling transactions were not approved by banks and credit card issuers because they were categorized with four simple digits: 7995. That is the category code given to all online gambling efforts. []

Discover CEO: Expect ‘Rocky’ Rollout of Payment Cards with Chips

The rollout of debit and credit cards with embedded microchips will be “rocky,” as consumers begin to realize they must dip the plastic instead of swipe it at the nation’s cash registers, the chief executive of Discover Financial said. Credit card companies have said that, as of October 2015, their fraud policies will change, and any merchant that doesn’t have a chip-compatible payment system will assume liability for counterfeit card transactions. [Chicago Tribune]

A Third of Millennials Have Never Had a Credit Card

In a society where tens of millions rely on a credit card to shop or pay bills, a new survey reveals that more than a third of Millennials have never had one. 36% of Americans between the ages of 18 and 29 have never had a credit card. That may be due in part to a 2009 law that whittled away the offers of credit to college students. The Great Recession also may have left some younger consumers reluctant to rack up charges. [USA Today]

Costco to Pay Almost Zero to Accept Credit Cards

Costco has attained a goal that retailers have sought for years: near-zero expenses for credit-card payments. In a deal with Visa and Citigroup, Costco’s acceptance costs will be about zero, according to people familiar with the arrangement. That compares with the roughly 0.6% of each transaction the retailer pays its current partner, American Express. The arrangement shows the pressure that Costco, the biggest U.S. retailer that accepts just one brand of card, was able to exert on financial firms seeking one of the industry’s most coveted partnerships. [Bloomberg Business]

Southwest Airlines May Replace Chase for Credit Cards Program

Southwest Airlines is considering replacing JPMorgan Chase as the issuer of its Rapid Rewards Premier credit card program, according to two people familiar with the matter. One of those people said Southwest has hired investment bank First Annapolis as an adviser as it reviews the relationship with Chase. Visa is also part of the relationship with Southwest and Chase, though it could not be determined whether that relationship, where less money is at stake, is also part of the review. [The Street]

Trade Group Asks for Delay on Card Security Plan

A trade group representing thousands of retail food stores and pharmacies is asking the payment card industry to delay an October plan that puts merchants on the hook for fraudulent transactions if they don’t have equipment in place to accept more secure credit and debit cards. [The Wall Street Journal]

Apple Pay Trounces PayPal and Google Wallet in Customer Satisfaction

A new survey shows that when it comes to mobile payments, Apple Pay remains the player to beat. With each passing month, the number of Apple Pay users continues to increase. Additionally, Apple has aggressively increased the number of banks and credit unions that work with Apple Pay, a figure which now stands at over 200. Usage numbers aside, it’s also worth noting that Apple Pay users are seemingly much happier with their mobile payment experience than users who opt for rival payment services like PayPal or Google Wallet. [BGR]

New Citi Credit Card Earns You an AT&T Smartphone, For a Price

Citi and AT&T announced Thursday the AT&T Access More Card, which comes with an opportunity to earn a new smartphone. New card customers will be directed to a website where they can purchase a new AT&T smartphone for full price. After that they have to make $2,000 worth of purchases with the new card within three months, maintain AT&T service for at least 15 days, and then the carrier will reimburse them for the cost of the device, up to $650. In addition to the smartphone reimbursement feature, the Access More card also earns customers reward points. [Wireless Week] Weekly Credit Card Rate Report

Based on the 1,000+ cards in the Complete Credit Card Index, the average advertised APR for credit cards is 14.46%, slightly higher than last week’s average of 14.45%. Six months ago, the average was 14.52%. One year ago, the average was 14.47%. []

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This Week In Credit Card News: Freeze Your Lost Credit Card, Beware Of Sneaky Card Fees

Discover Rolls Out Freeze Feature on Credit Cards

“Freeze It” is a new feature on Discover cards that acts like an on-off switch for cardholders to stop new purchases and cash advances on a card that has been lost. Freeze It can be used from a mobile device, online or over the phone. The account can be turned back on at the customer’s discretion. [Chicago Tribune]

Watch Out for These Sneaky Credit Card Fees

So-called gray charges on credit cards–which are not illegal, only deceptive–may seem like minor nuisances. But they can add up over time. BillGuard, a mobile app that tracks spending and flags suspicious transactions, estimates that these charges cost U.S. consumers more than $14 billion annually. [CNBC]

The Pros & Cons Of Personal Loans vs. Credit Cards

Without credit, capitalism would stagnate. But who to borrow from? There are thousands of institutions in the business of lending money, some even bear the imprimatur of the Federal Deposit Insurance Corporation. So it’s just a case of going to whoever offers the lowest rate, right? The answer is both yes and no. [Investopedia]

Experiment Reveals How Fast Stolen Data Spreads on the Dark Web

An experiment from BitGlass studied how stolen credit cards and Social Security numbers make their way through the Internet after a data breach. The results revealed data travels at a remarkable speed and showed just how poor the detection efforts have been in America. The tracking showed that in just a few days, the data had been viewed over 200 times by people in five different countries across three continents. By day 12, the data had received 1,081 views and reached 22 countries in five continents. []

Target Announces $19 Million Data Breach Settlement with MasterCard

Target said it had agreed to reimburse about $19 million to financial institutions that had issued MasterCard-branded cards that were a part of the massive data breach at the retailer in 2013. [Reuters]

More Prepaid Debit Cards Come Without Monthly Fees

A new survey found that prepaid debit cards are carrying fewer fees and offering customers more chances to avoid additional costs that may be tacked onto the account. Unlike gift cards, which have a set dollar amount on them and usually can’t be refilled, general-purpose prepaid cards can be loaded with cash or direct-deposit payroll checks and used anywhere traditional credit or debit cards are accepted. [The Wall Street Journal]

Apple Watch Generates Nearly 1 Million Pre-Orders

Apple began taking pre-orders on its Apple Watch last Friday, two weeks prior to the product’s official launch date of April 24. Based on research from Slice Intelligence, pre-orders in the United States reached an estimated 957,000 units. The average buyer ordered 1.3 units and spent an average of $503.83 per watch. []

CFPB Finalizes Rule Aimed at Improving Credit Card Agreement Submission Process

The Consumer Financial Protection Bureau has issued a final rule aimed at improving the way companies submit consumer credit card agreements to the bureau. The rule temporarily suspends a requirement that each quarter certain credit card issuers send their agreements to the bureau, which publishes them in a public database on its website. [ACA International]

Data Breach Notification Legislation Moves Forward

The controversial data breach notification legislation made its way past the committee level on Wednesday when the House Energy and Commerce Committee approved the measure 29-20. While some legislators have argued the bill is too vague and overarching, others think there needs to be more provisions about enhanced consumer data protection at the state level as well as the federal. Democrats against the bill have pushed to have more specifics included, while proponents of the bill think tailoring it too much would hinder the impact of the legislation. [PYMNTS] Weekly Credit Card Rate Report

Based on the 1,000+ cards in the Complete Credit Card Index, the average advertised APR for credit cards is 14.45%, identical to last week. Six months ago, the average was 14.57%. One year ago, the average was 14.46%. []

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This Week In Credit Card News: Establish Credit For Your Kids, Will Chip Cards Solve Fraud?

Walmart Exec: New Credit Card Design Won’t Solve Fraud

There’s been some hope that improved credit card technology might finally lead to greater security and a reduction of credit card fraud. One idea has been credit cards with embedded chips, which can encrypt data during transactions, making the process more secure. But the basic technology, which is widely used throughout the world, is being introduced with a significant flaw in the U.S., as a Walmart executive said at a conference. The problem is banks that enable the chip technology will only require signatures, not the input of a PIN code. [Daily Finance]

4 Ways to Help Kids Establish Credit

Parents have four potential options:. They can co-sign for their kid’s card, make the child an authorized user on a parent’s account, help them establish a banking relationship that comes with a low-limit card or suggest that they get a secured card. The best choice is likely to depend on both the student and his or her parents. Here are the options, their benefits and detriments. [CBS MoneyWatch]

Exponential Growth Of Online Personal Loans Threatens Credit Card Profits

In a world where universal banks are struggling to generate a double-digit Return on Equity, credit card businesses are regularly generating returns above 20%. As a result, many banks have discontinued their personal loan businesses entirely, and steer all consumer borrowing needs to credit cards. But in the last few years, a new crop of startups have recognized that the borrowers are not getting a good deal. These startups want people to refinance their credit card debt from high, double-digit interest rates to much better rates. The personal loan companies have a simple plan. First, they have created a low-cost operating model that have redesigned and automated much of the lending and customer service model. And, they have been designed to be the opposite of credit card lending. [Forbes]

Banks Raising Credit Card Borrowing Limits for Subprime Customers

With profits pinched by tighter regulation and low interest rates, banks are easing lending standards at a time when loan losses have plunged, labor markets are stabilizing and consumers are spending more. Consumer advocates, however, worry that banks’ pursuit of profits could result in sticking struggling consumers with more debt than they can handle. Credit card firms approved 61% of the requests from cardholders for higher borrowing limits in an October survey by the Federal Reserve Bank of New York. But that approval rate shot up to 76% in February’s national survey. [Los Angeles Times]

Millennials Give Prepaid Debit Cards a Boost

A third of Americans 18-34 years old have used a reloadable prepaid debit card compared with only a quarter of Americans overall, according to a new survey by TD Bank. And 60% of millennials would consider using one compared with half of the overall population. One reason: They’ve cleaned up their act. Prepaid debit cards used to be notorious for charging high fees, including several prepaid cards promoted by celebrities, such as Justin Bieber and Kim Kardashian. But criticism from consumer advocates—and cheaper offerings from American Express and Chase in recent years—put pressure on the bad actors to lower fees or leave the market. [CNBC]

Protecting Your Child Against Identity Theft

Stealing a child’s Social Security number is one of the biggest prizes for an identity thief. Children have no credit files and, since parents rarely suspect anything, these stolen numbers can normally be used for years. Almost half of the data breaches in 2014 took place in medical databases. The breach in December of the Anthem insurance database, where over 80 million people had their social security numbers stolen, may well cause a surge in attempts at child identity theft. An expert with Experian has estimated that 24 million children may now be at risk just from the Anthem breach alone. []

Microsoft Might be Working on its Own Payment System

Soon, there might even be a Microsoft Pay. Or “Microsoft Payments” rather. Some evidence have surfaced pointing to Microsoft’s intention to become a money transmitter in the US as well as the country’s current and former territories. Although it is still in the extremely early stages of preparing the legal foundations of such an enterprise, Microsoft could very well be planning to take on the still nascent and somewhat unproven mobile payment industry, pitting it against Apple, Google, and Samsung who already has a head start. [Slash Gear]

How to Get a Low-Fee Prepaid Card That Actually Helps You

Prepaid debit and credit cards tend to come with high fees and high interest rates. NerdWallet estimates that the average prepaid debit card comes with $300 in “basic” fees attached for every year of ownership—and that’s before activation, cancellation, paper statements and other fees kick in. A study shows that 26% of cards have no monthly fee and 26% will waive the monthly fee if a certain amount is loaded on the card. Altogether, 52% of the cards either have no monthly fee or will waive it, contributing to a summation that prepaid card monthly service fees, activation fees and fees for calling customer service have declined over the past year. [Main Street] Weekly Credit Card Rate Report

Based on the 1,000+ cards in the Complete Credit Card Index, the average advertised APR for credit cards is 14.45%, slightly higher than last week’s average of 14.47%. Six months ago, the average was 14.56%. One year ago, the average was 14.45%. []

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This Week In Credit Card News: Secret Credit Card Benefits, Thieves Target Elite Cards

Fraudsters Target Elite Credit Cards Twice as Often

So-called elite credit cards have nearly twice the fraud rates as other types of regular plastic, according to Forter, which makes fraud prevention software for online retailers. Forter found people who commit credit card fraud tend to burn the midnight oil. Most fraud occurs between 2 a.m. and 6 a.m. The fraud rate is 10 times as high then as the rate between 2 p.m. and 6 p.m. [CNBC]

Your Credit Card’s Best-Kept Secrets

When managed properly, credit cards can actually save you money through valuable benefits. Understanding your benefits can help you make better choices about when to use them and how to
save on all kinds of products and services. Here are six secret benefits you might already have. [MarketWatch]

Credit Card of the Future Could Stop Fraud

As banks seek to reduce fraud, one credit card maker has a prototype with a constantly-changing code on the back. It is from the French company Oberthur Technologies. Expect it in 2017 if it catches on with major banks. The mini ink screen is powered by a lithium-ion battery (like a phone) the size of a postage stamp that’s designed to last three years. A computer chip randomizes the number every 40 or 60 minutes. The changing code renders the card useless to anyone who has written down your credit card
number, expiration date and the code on the back. [CNN Money]

Some Significant Shifts in the Credit Industry

A new survey shows some noteworthy shifts taking place in the credit industry. Rejection rates for credit applications are declining and more consumers plan to apply for credit during the next 12 months. New applicants for credit remained steady over the past year and a half but rejection rates dropped from 30% in October 2014 to 25% in February 2015. Also, respondents who asked for a credit limit increase and got rejected dropped from 38.5% last October to 24.3% in February. The number of people who plan to apply for credit cards over the next 12 months rose from 7.8% in October to 11.6% in February. []

Are Gas-Brand Credit Cards Running on Empty?

If you’re carrying a gasoline-branded credit card in your wallet, you may want to throttle back. While fuel cards can be a smart option in special cases, you’ll do better pumping up your rewards with another type of card. In general, gas cards have minimal rewards, paltry signup bonuses, extra hoops to jump through and carry higher interest rates compared to general-purpose cards. [Pittsburgh Post-Gazette]

AmEx CEO Says Company was “Arrogant” in ’80s and ’90s?

American Express was cocky back in the day. That was the message American Express Co. Chief Executive Officer Kenneth Chenault said Tuesday. He revealed that in the 1980s and ’90s AmEx “gained a reputation as being prestigious, elitist and expensive—and for years we reveled in those attributes. We took our prestige so seriously that as a company, we too became elitist and arrogant.” []

Seeing a Tax Refund as a Financial Opportunity

So far this year, the Internal Revenue Service has processed more than 66 million federal income tax refunds, averaging about $2,900 each. This is an opportunity to help get your finances on track. [The New York Times]

College Freshmen Feel Ill-Equipped to Manage Their Money

First-year college students feel less prepared to manage their finances than to tackle other aspects of college life. Only 58% of students surveyed said they felt prepared to manage their money, while 73% felt ready to keep up with coursework and 63% were confident about managing their time. [The Wall Street Journal]

Creditless Can Benefit from New FICO Score

People struggling with a bad credit score, or lack of one, could benefit from a program rolling out in the next few months aimed at making it easier to get a Visa or MasterCard. Under the program, Fair Isaac, working with LexisNexis and Equifax, will create a payment history profile from a person’s utility bills and public property records. FICO would use that pooled data to determine an “alternative” credit score when a person with a poor credit history, or none at all, applies for a credit card. [Associated Press] Weekly Credit Card Rate Report

Based on the 1,000+ cards in the Complete Credit Card Index, the average advertised APR for credit cards is 14.47%, identical to last week. Six months ago, the average was 14.54%. One year ago, the average was 14.45%. []

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This Week In Credit Card News: Pay Bills Through Gmail, New Malware Targets Card Terminals

Google Working on Project to Let You Receive and Pay Bills Directly Inside Gmail

Google is currently working on a project that will allow Gmail users to more easily receive bills in their email inbox instead of their mailbox. Called Pony Express, the service also is designed to let people pay their bills within Gmail. [Re/code]

Point Of Sale Malware Targets Credit And Debit Cards

A new point of sale malware program has taken to attacking the payment terminals themselves to steal all your card details. Dubbed PoSeidon after the point of sale terminals it attacks, it was uncovered by researchers at high profile Cisco’s Security Solutions. The malicious programme uses a technique called memory scraping, which scans the RAM of any infected machine for data resembling credit card numbers. Whilst the transaction is being processed, the data is kept in the RAM in plain text before being encrypted and stored which means that intercepting the information, without anyone knowing, is actually very easy for those in the know. [Tech Aeris]

Check Out the Insane Rewards Offered by this New Credit Card

With the Discover it Miles card, you can get 3% cash on everything you buy, at least for the first year. The new addition to Discover’s “it” platform is geared toward consumers who want to earn travel rewards without having to participate in specific airline loyalty programs. This travel rewards card can actually provide the best cash back value of any card on the market. At least for a year. [Time]

Five Reasons to Beware of Autopaying Bills

About 61% of Americans have set at least one bill to pay automatically. The main reason consumers use autopay is to make sure bills are paid on time. That is vital to their credit scores when it comes to debts like car loans, credit card balances and mortgages, but most other on-time payments are not recorded. A recent study by credit reporting firm Experian, however, suggests that including positive utility payment histories, which is not commonly done, could help elevate the credit scores of millions of Americans. As much as automation can be a positive, there are plenty of catches to be watch out for. [Reuters]

One in Four Consumers Willing to Pay for Mobile Banking

New data from SNL Financial indicates one in four consumers would pay for mobile banking if their banks decided to start charging for it. The group asked nearly 4,400 consumers in the United States one simple question: “If your bank charged $3 a month to use its mobile bank app, would you pay to keep using the bank app?” 24% said yes. There was a significant difference by age group: the older the consumer, the less willing to pay a fee for mobile banking. []

AmEx Clipped by Rival Credit Card Companies

Changing consumer habits, extremely aggressive competition and increased pushback from its merchants are putting heavy pressure on American Express. Rivals are trying to steal away business and are succeeding in some cases. Costco is ending its relationship with AmEx. Airlines that used to give VIP lounge access to AmEx cardholders have been switching in recent years to other credit card companies. Compounding its troubles, AmEx recently lost a major government antitrust lawsuit, a verdict that could
damage its ability to compete. [Associated Press]

93 Million Prepaid Cardholders are Unprotected

When it comes to financial services, many consumers are surprised by the range of fees attached to their transactions. Yet one financial product with growing popularity has no comparable consumer protection: prepaid cards. Multiple added costs for usage can widely vary. Fees can include some or all of the following typical transactions: ATM cash withdrawal, balance inquiry, bill payments, card cancellation, inactivity, monthly usage, replacement of lost or stolen cards, and overdraft fees. According to FDIC, the largest users of prepaid cards include 25 million unbanked consumers and an additional 68 million who are underbanked, preferring these cards or other alternative financial services to traditional institutions. [Pittsburgh Courier] Weekly Credit Card Rate Report

Based on the 1,000+ cards in the Complete Credit Card Index, the average advertised APR for credit cards is 14.47%, slightly below than last week’s average of 14.48%. Six months ago, the average was 14.53%. One year ago, the average was 14.47%. []

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