It Just Got More Difficult For Bank Customers to Find a Free Checking Account
Bad news for low-income consumers: There’s now one fewer place where you can store your cash for free. Bank of America has gotten rid of a free checking account called eBanking. More than 45,000 people have signed an online petition protesting its elimination, on Change.org. Instead, the account holders will be charged a $12 monthly fee if they don’t have at least a $250 direct deposit that month, or a daily account balance of $1,500 or more. The eBanking accounts debuted in 2010 and offered an affordable alternative to consumers without a lot of cash. Free checking accounts are especially rare in areas where low-income consumers need them the most. Story by Maria LaMagna for MarketWatch
31 Million People Believe They’ll Still Owe Credit Card Debt When They Die
With credit card debt hitting new records, some analysts are beginning to worry about the ability of many Americans to pay off rising debt levels. And a new study calculates that up to 31 million Americans with credit card debt believe they will never be able to pay if off and will die with debt. 35% of U.S. adults with credit card debt, or about 31 million, said they do not think they will ever get out of debt. Another 33% of Americans with credit card debt don’t know when they will be debt free. Story by David Carrig for USA Today
Discover Topping Credit Card Rivals in Growth, and Bad Loans
As 2018 dawns, Discover Financial Services finds itself a leader in an unfamiliar category: bad credit card loans. Probably not coincidentally, the company is growing its credit card balances at twice the rate banking giants like JPMorgan Chase and Bank of America are. Discover has gone in a year from nearly best-in-class in terms of customers who stay current on their credit cards to nearly worst-in-class. Among the major card issuers, only Capital One will be expected to have higher charge-offs. But that’s because Capital One lends to subprime borrowers unlike Discover. Discover’s card-loan write-offs aren’t at alarming levels. It posted charge-off rates of 3 percent in October and 3.1 percent in both November and December. But those numbers are 0.5 percentage points above the same time frame the year before. No other major issuer that’s posted fourth-quarter results so far has shown such an acceleration in bad loans. Story by Steve Daniels for Crain’s Chicago Business
CFPB Delaying New Prepaid Card Protections by One Year
The Consumer Financial Protection Bureau on Thursday said it would delay, by one year, the implementation of new rules for prepaid payment cards and the agency said it will add more flexibility to the regulations to address industry concerns. The agency’s rule on the prepaid market, which took nearly six years to finalize, has been among its most criticized. Consumer advocates argue the market has been lightly regulated and offers few protections for consumers, particularly those who are victims of fraud. The CFPB finalized rules last year that require companies to clearly disclose any fees and cooperate with consumers who discover unauthorized charges or errors in their accounts. The industry complained that the rule was too broad and could leave them on the hook for fraudulent losses. The CFPB says it will give prepaid card providers more time to investigate claims before refunding money customers say they have lost to fraud. The CFPB said the rules would now go into effect in April 2019. Story by Renae Merle for The Washington Post
A Lawsuit Over Credit Card Fees Could Further Empower Big Tech
Next month, the U.S. Supreme Court will hear what legal experts describe as one of the most important antitrust cases in years. The focus of this particular dispute is on credit card fees, but it may be more notable for the impact it could have on the economy of the internet. The case-Ohio v. American Express-has no direct connection to tech giants like Google, Facebook or Amazon. But Silicon Valley could be a major beneficiary if the Supreme Court upholds a lower court’s decision. This prospect is causing alarm in certain circles. Story by Joshua Brustein for Bloomberg
Mastercard to Implement Biometrics for In-Store Card Payments
Mastercard is implementing biometrics for card payments, with plans to go live by April 2019. The financial giant said that all consumers will be able to identify themselves with biometrics such as fingerprints or facial recognition whenever they pay in stores with Mastercard. Biometric options will also be implemented for all contactless transactions made at terminals with a mobile device. In practice, that means that banks issuing Mastercard-branded cards will have to be able to offer biometric authentication for remote transactions, alongside existing PIN and password verification. Story by Tara Seals for Infosecurity Magazine
Obsolete Jerseys A Fear No More As American Express Partners With Fanatics
Just when you thought being an American Express card member was perky enough, the financial giant comes out of the tunnel with a new benefit. Amex, the official card of the NBA, has partnered with Fanatics, a licensed sports merchandise company, to build on the NBA Jersey Assurance Program. The recently introduced program allows consumers to exchange NBA jerseys purchased at Fanatics.com or NBAStore.com of eligible players who change teams through trade or free agency, for up to 90 days post-purchase. Amex is building on this guarantee, extending the exchange window to a full year for consumers who purchase their jerseys using an American Express card. Story by Aliko Carter for Forbes
Mobile Banking Reaches 90 Percent Saturation With Financial Institutions
The last time we heard from the Federal Reserve Bank of Boston, they were trying to tell us that mobile payments adoption rates weren’t exactly looking for a big jump. However, the bank may have to eat its words-at least an appetizer portion of them-as it recently released a report saying that mobile banking has definitely taken off, to the point where nine out of 10 financial institutions now offer the service. Not only did it find that 89 percent of said institutions offered mobile banking, but the customers were interested as well. Fifty-four percent of organizations offering such services noted that at least 20 percent of customers had enrolled, and 44 percent of the tracking institutions had over 20 percent actively putting mobile banking services to use. Story by Steven Anderson for Payment Week
Stripe Will No Longer Process Bitcoin Transactions Come April
As cryptocurrencies continue to show volatility in the market, transaction processor Stripe has decided to stop supporting bitcoin payments for small businesses on April 23. Stripe’s Tom Karlo noted several issues with processing bitcoin transactions, noting that confirmation times “have risen substantially.” That, in turn, leads to a high failure in transactions because price fluctuations in bitcoin’s price means that purchases are made for what’s essentially the wrong amount. And, the cost to process a bitcoin transaction has risen from just pennies to as much as $35 to $40. Story in Mobile Payments Today
Citi Simplicity Trims 0% Intro APR Period to 18 Months
One of the best balance-transfer offers on the market just got a little less attractive. Citi has reduced the 0% introductory APR period on the Citi Simplicity Card. The card now offers 0% on Purchases and Balance Transfers for 18 months, and then the ongoing APR of 15.24% – 25.24% Variable APR. That’s three months less than the card’s previous offer. Story by Kenley Young for Nerd Wallet
Should You Use Virtual Credit Cards?
Virtual credit cards have been around in one form or another for years now, but their use has yet to truly take off among consumers. A crop of new startups however, such as Pay With Privacy and Token Payments, are poised to change that. These two companies may not be household names but perhaps they should be. Both are joining the effort to help consumers beat credit card fraudsters at their game at a time when the list of blockbuster data breaches seems to be growing longer by the day. For those not familiar with virtual credit cards, they come in various forms but are typically temporary, randomly generated, credit or debit card numbers. Often the numbers link to a real payment account, such as a credit card, debit card or checking account. Story by Mia Taylor for MarketWatch