Card default rates, credits are increasing
According to a TransUnion survey of nearly six million consumers, consumers who were more than 90 days overdue on their cards continued to extend their credit lines between Q3 2019 and Q4 2021. During that time, consumers who were 90 days late on their credit card reduced the amount paid. further the minimum payment, but consumers on their bank card increased the amount paid above the minimum payment. The decline in consumer liquidity started 12 months before major default and increased across all credit levels. Most consumers reached 30 days past due three months prior to serious delinquency, a sign that segmenting customers based on their liquidity changes nine months to a year in advance is helpful. [Payments Dive]
Credit card balances and delinquencies are increasing
Creating a 25-year marketing and sponsorship relationship for Mastercard and MLB? Priceless.
A quarter of a century ago, Mastercard wanted to do away with its utilitarian brand persona with a new advertising agency and campaign that would inject emotion into a category fixated on APRs and annual fees. As former Mastercard US chief Peter Dimsey (now deceased) told us at the time: “Competing on price is never a good strategy; anyone can copy that.” McCann Erickson (now McCann) won a six-agency shootout with the “Priceless” series, now considered one of the greatest ad campaigns ever, one that revived a brand that was then labeled “a mess” by its own executives. The Priceless campaign debuted in World Series Game 1, October 18, 1997. That very first spot showed a bond between father and son in the stands at an MLB game with what has become a well-known formula. [Sports Business Journal]
Americans continue to pay inflation with credit cards
Credit card debt continues to rise as consumers struggle with rising prices and depleted savings. In August, revolving credit rose a whopping 18.1%, while total consumer debt soared to a record $4.68 trillion, according to the latest consumer credit data from the Federal Reserve. Total consumer debt rose $32.2 billion in August, up 8.3% year-over-year. That was well above the $24 billion projection. [Schiff Gold]
The ‘unexpected’ that Americans are now blaming their credit card debt
According to the Federal Reserve Bank of New York, Americans’ credit card debt rose to $887 billion in the second quarter of 2022. And the No. 1 reason they cite for this debt? Urgent or unexpected expenses, with 46% of debtors citing an emergency or unexpected expense, including a medical bill, home repair, car repair or other emergency/unexpected expense, as the reason they carried a balance month-to-month, according to a new Credit Cards .com report. The solution to this is a time-tested rule embraced by nearly all personal finance bigwigs: build an emergency fund. And there’s good news on that front: savings accounts like this one now pay a lot more than they did last year. [MarketWatch]
Buy now, pay later is still a blind spot for creditworthiness
US consumers signed billions of dollars in “buy now, pay later” plans last year. Almost none are reflected in their credit scores. Equifax, Experian and TransUnion began to allow buy now, pay later companies to report their short-term payment plans earlier this year. But some of the biggest players in the business, including Affirm, Klarna and Afterpay, aren’t doing that yet. [The Wall Street Journal]
EMVCo rolls out new payment standard
A new software standard for contactless and mobile payments was approved on Wednesday by the international standards body EMVCo in an effort to unite the card industry around one approach. The software, which EMVCo calls a “kernel,” enables payment acceptance at POS terminals and ATMs for processing card transactions, even in cases where the card is built into a phone. There are currently about 20 different contactless payment “kernels” in use by merchants worldwide, so the new specification aims to reduce complexity and cost. [Payments Dive]
Google Selects Coinbase To Accept Cloud Payments With Cryptocurrencies
Google said it will rely on Coinbase to allow some customers to pay for cloud services using cryptocurrencies in early 2023, while Coinbase said it would leverage Google’s cloud infrastructure. The deal, announced at Google’s Cloud Next conference, could succeed in luring leading companies to Google in a fierce, burgeoning market where Google’s biggest competitors currently don’t allow customers to pay with digital currencies. The cloud business is helping Google’s parent alphabet diversify away from advertising, and it now accounts for 9% of revenue, up from less than 6% three years ago, as it grows faster than Alphabet as a whole. [CNBC]
Nearly half of Gen Z, millennials to rely on Buy now, pay later this holiday
As shoppers stretch their vacation budgets, a survey of 1,000 consumers from customer service technology company Bluedot found that four in 10 respondents said they plan to pay for their vacation purchases with buy now, pay later. The survey found that nearly half (48%) of Gen Z respondents said they plan to use BNPL services this holiday season, followed by millennials (47%), Gen X (40%) and baby boomers (14%). Nineteen percent said they use BNPL services because they have little money. Eighty percent of respondents said they plan to shop as much or more through retailers’ mobile apps during the holiday season of 2022 than last year. More than half (55%) of respondents said they plan to use retailers’ mobile apps because they are easy to use, while 38% say they look for discounts. [Retail Dive]
Credit card swipe fee change removed from defense spending account
A two-pronged last-minute attempt to package a credit card swipe fee change into a larger spending bill was ultimately unsuccessful. sen. Dick Durbin (D-Ill.) and Sen. Roger Marshall (R-Kan.) pushed for the 2022 Credit Card Competition Act to be incorporated into the National Defense Authorization Act, raising the alarm from banks, credit unions and other financial services firms who claimed the move would disrupt credit card loyalty programs. to disturb. The Credit Card Competition Act aims to weaken the market power of card issuers Visa and Mastercard and would require several amendments, including requiring merchants to have at least one network for credit card transactions unrelated to Visa or Mastercard. [PYMNTS]
JP Morgan and Visa Bridge Their Private Blockchain Networks to Streamline Global Payments
JP Morgan and Visa are teaming up to streamline cross-border payments using their private blockchain networks, Liink and B2B Connect. Failed payments cost the global economy $118 billion a year; 66% of that is caused by incorrect account information, according to JP Morgan. Confirm expects it will soon validate account data from 3,500 banks, covering more than 2 billion accounts. In addition to reducing failed payments, Confirm promises to reduce fraud by confirming that an intended recipient owns the bank account to which money is being transferred. [Forbes]
Juniper predicts 121 billion virtual card transactions by 2027
The integration of virtual cards into digital wallet services such as Apple Pay and Google Pay will increase the number of virtual card transactions by 340%, from 28 billion in 2022 to 121 billion in 2027, Juniper Research predicts. Virtual card transactions via mobile payment methods will represent 53 billion of the 121 billion transactions by 2027, up from 5 billion in 2022. Virtual cards, randomly generated card numbers linked to a payment account, will be a major market driver for consumer adoption of contactless payments in fast developing economies such as India. [NFCW]
Dark Web Marketplace ‘BidenCash’ Hands Out 1.2 Million Stolen Credit Cards As Promotion
Now even hackers are taking a page from the script of major advertisements to promote their ill-gotten personal financial information. Over the weekend, the stolen credit card marketplace BidenCash announced that they were offering a free giveaway of 1,221,551 credit cards, promoting the leak on multiple other sites. The credit cards can come from multiple sources, including malware forced into online stores, malware attacks by individual users, or breaches of companies that store credit card information. [Gizmodo]
