Republican Lawmaker Proposes 18% Cap on Credit score Card Curiosity Charges
Bank card corporations ought to be barred from setting rates of interest increased than 18%, a Republican lawmaker from Missouri proposed Tuesday. If handed, U.S. Senator Josh Hawley’s invoice, the Capping Credit score Card Curiosity Charges Act, would additionally block credit card companies from introducing new charges aimed toward evading the cap and penalize lenders with annual share charges that exceed 18%. Hawley’s invoice comes as People are grappling with record-high bank card charges whereas carrying barely greater than $1 trillion in card debt. The common bank card charge has been inching towards 21% for the previous three months and was 20.68% as of final week, making it dearer for shoppers to hold balances, based on Bankrate information. [CBS News]
The variety of folks utilizing a purchase now, pay later choice has doubled in two years
Purchase Now Pay Later Utilization in U.S. Doubled Since 2021
Almost a tenth of People, 8%, have used Purchase Now Pay Later credit score financing for on-line purchases within the final yr, a 2x improve since 2021, a YouGov report finds. People throughout each era have elevated adoption of BNPL since 2021, with millennials representing the most important development phase (growing by 91%). In the meantime, on-line credit card utilization amongst U.S. millennials has dropped by 4% throughout the identical time interval. The report identifies that amongst U.S. BNPL customers, 49% have lower than $1,000 saved versus 30% of the final inhabitants. [Payments Dive]
Credit score Playing cards, Debit Playing cards Most In style for Vacation Buying
Rising rates of interest and inflation are anticipated to influence vacation buying habits. Bank cards are anticipated to be the preferred cost technique for vacation buying, based on a survey by shopper monetary companies firm Bankrate. Greater than half (53%) of vacation consumers say they anticipate to pay for a minimum of a few of their purchases with a bank card, together with 19% who say they may tackle credit card debt for his or her vacation purchases. Debit playing cards are a detailed second, with 52% of consumers planning to make use of a debit card. Solely 10% of vacation consumers plan to make use of a buy-now, pay-later service, and 5% to plan to pay with checks. [Chain Store Age]
Common Overdraft Worth Hits 19-Yr Low
The common value of a shopper overdraft dropped by 11% this yr, based on a brand new survey from Bankrate.com, because the banking trade continued shifting away from the fees amid persistent regulatory stress. Although most banks nonetheless cost overdrafts, the typical charge fell to $26.61 from $29.80 final yr, the annual survey discovered. The charges peaked at $33.58 in 2021. Bigger banks began asserting overdraft reforms that yr. Ally Financial institution eradicated overdraft charges, a transfer that Capital One and Citigroup would quickly comply with. Financial institution of America slashed its charge to $10, and some regional banks adopted swimsuit in lowering the fees. [American Banker]
Xbox Groups With Mastercard to Unveil First Credit score Card
Microsoft-owned gaming platform Xbox is debuting its first co-branded bank card within the U.S. The Barclays-issued Mastercard will probably be accessible on Sept. 21 solely to certified Xbox Insiders throughout the nation earlier than turning into open to most of the people within the U.S. beginning subsequent yr. The cardboard comes with quite a lot of perks, like three months of Xbox Recreation Go Final for customers who make their first buy inside 180 days of opening their account, and 3X card factors on sure streaming platforms and eating supply companies. [PYMNTS]
Delta to Slash Sky Membership Entry for Amex Card Holders, Change How You Earn Elite Standing
Dangerous information, Delta followers: it’s quickly going to be lots more durable to entry Delta Sky Golf equipment and earn Medallion elite standing. On the Sky Membership aspect, these with premium American Categorical playing cards could have their lounge entry lower from limitless visits to as few as six visits per yr, relying on which card they’ve. These modifications take impact in 2025. The airline will utterly change the way it awards Medallion elite standing subsequent yr. Beginning subsequent yr, there’ll solely be one metric, Medallion Qualifying Greenback, and necessities are a lot increased than what they’re in the present day. And to make issues worse, the MQD waiver provided by widespread Delta bank cards goes away. [CNN]
Hallmark Lets Customers Venmo Present Playing cards as DoorDash and Costco Up Digital Too
To adapt to the evolving preferences of Gen Z consumers relating to gift-giving, Hallmark is embracing trendy avenues equivalent to digital funds and cellular apps. In late August, Hallmark cast a partnership with Venmo to introduce over a dozen co-branded bodily greeting playing cards. These playing cards, accessible on-line and at Hallmark, CVS and Walgreens retailers, characteristic a QR code directing customers to Venmo. The giver makes use of the code to switch funds to the recipient whereas the recipient scans the code to obtain the cost. These playing cards can be found for buy at $4.99 every and are available a spread of themes, together with “Comfortable Birthday” and “Greatest Christmas Ever.” Two years in the past when Hallmark began integrating personalised movies into its bodily playing cards by means of QR codes. It additionally launched a cellular app that empowers prospects to customise playing cards immediately on their smartphones. [PYMNTS]
A New ‘Threat Rating’ Is Generated
Synthetic intelligence is reaching into all corners of monetary companies, and that clearly consists of funds. Mastercard is reporting it has launched a brand new answer that makes use of AI to generate a “danger rating” for transactions to judge the legitimacy of the individual on the receiving finish of a digital cost. The transfer comes within the wake of real-time funds and the official introduction by the Federal Reserve of its FedNow service. Whereas it’s excellent news for these making or anticipating funds, it has additionally opened the door to fraudsters, making it simpler for crooks who impersonate a person or firm to trick an individual into sending cash after which to flee with the funds. Referred to as approved push cost fraud, it has been rising markedly in the UK and it’s anticipated to develop into a big difficulty within the U.S. as real-time funds take higher maintain. [CU Today]
Mastercard and Paysend Deepen Cross-Border Funds Tie-Up
Mastercard is extending its partnership with Paysend aimed toward enhancing cross-border funds for small-and-medium-sized companies (SMEs). SMEs are more and more looking for new methods to ship cash overseas or pay distributors across the globe. Certainly, regardless of the disparity in scale between SMEs and huge enterprises, small companies make up over 98% of European imports and exports. Almost 40% of SMEs surveyed in a Mastercard report say that cumbersome cross-border funds processes are slowing down their provide chain, with 1 / 4 stating that they’d misplaced suppliers in consequence. [FinTech Magazine]
Do Present Playing cards Must Be Plastic? Hallmark, Blackhawk Check Paper Choices
Going through rising cost card environmental-impact issues, card networks and banks are switching from dangerous virgin plastic to utilizing recycled and biodegradable supplies for credit score and debit playing cards. Now present playing cards are going inexperienced too, utilizing paper. Present-card large Blackhawk Community this month introduced plans to roll out extra sustainable paper-based variations of its Visa present playing cards as a part of a long-term plan to finish reliance on first-use plastic for greater than 700 million playing cards the corporate helps produce yearly. The primary wave of paper-based Visa pay as you go present playing cards will roll out within the U.S., Canada and Australia starting this fall. [American Banker]
10 Methods to Cut back Your Credit score Card Processing Charges
Swipe charges take a chunk out of most non-cash funds. Lowering service provider bank card charges can enhance your backside line. However your technique will depend on your transaction quantity, trade, and buyer base. Use these tricks to decrease the prices of processing bank cards. [U.S. Chamber]
