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LowCards.com Weekly Credit Card Update–November 11, 2016

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CFPB Likely to Be Reined in Under Trump, Republican Congress
The Consumer Financial Protection Bureau could have new leadership and curtail its robust rulemaking and enforcement activities under President Donald Trump. Trump may be able to replace CFPB Director Richard Cordray if an October federal appeals court ruling in PHH v. CFPB that the bureau is an executive branch agency stands-that is if congressional Republicans don’t get rid of his job entirely first. Congressional Republicans had already made clear they want to rein in the CFPB’s independence by replacing the CFPB with a board, subject it to the congressional appropriations process, and even rename the agency. Story by Chris Bruce and Gregory Roberts for Bloomberg.

More Americans Turn to Mobile Banking
Significantly more Americans are turning to mobile and online banking, according to a recent study from the Federal Deposit Insurance Corporation. The FDIC National Survey of Unbanked and Underbanked Households found that, from 2013 to 2015, the percentage of Americans using online banking rose from 55% to 60%, and mobile banking use grew at an even faster rate, rising from 23% to 32%. The FDIC concluded that Americans, particularly the underbanked, appreciate the greater control and convenience offered by mobile and online banking. The FDIC found nearly 20% of households were identified as underbanked, which they defined as households that “had an account at an insured institution but also obtained financial services and products outside of the banking system.” These underbanked households were more likely to use their mobile devices as their primary method of managing their accounts, because they saw significant benefits with these products, including reminders and balance alerts that helped them stay on top of their finances. Story by Bill Hardekopf for LowCards.com.

Good News for Visa and Mastercard, As Card Spending Grows
American consumers just can’t get enough of their plastic. U.S. spending on electronic payment cards rose 7.4% last year to $5.8 trillion, according to new data from The Nilson Report. In total, U.S. consumers made 104 billion transactions on their cards in 2015. Credit cards accounted for 53.5% of all card spending, while debit cards were 46.5% of card spending. This, of course, is good news for Visa and Mastercard, the dominant card networks. American Express still carries some heft, as well. Visa-branded cards had 47% of purchase volume in the U.S. in 2015, followed by Mastercard at 21%, and Amex at 12%. Story by Alex Eule for Barron’s.

Yahoo Tells SEC It Knew about Data Breach in 2014
Yahoo fessed up in its latest SEC filing that it knew in 2014 that attackers were on its network and stole information from 500 million accounts. The breach was disclosed in September and Yahoo blamed state-sponsored attackers, a claim that was challenged by some experts who instead said a criminal outfit was behind the attack and may have sold some of the data to an Eastern European government. The SEC filing also contains a confirmation from Yahoo that Verizon’s multibillion-dollar acquisition of Yahoo’s core business could be in jeopardy, and that Verizon could seek to terminate or renegotiate the terms of the sale. Story by Richard Mimoso for Thread Post.

Citibank Launches Citi Pay Mobile Wallet and NFC Payments Service
Citibank has launched a new mobile wallet using Mastercard’s Masterpass digital payment service, allowing up to 100m of its customers to make purchases online and in-app, as well as NFC mobile payments in-store, in 33 countries. Citi Pay is available to all Citi customers for online, in-app payments, while for cardholders with Android devices it will allow them to make in-store purchases by tapping their mobile at any NFC-enabled point-of-sale terminal. Customers will be able to make online and in-app purchases using the same Citibank online user ID and password that they currently use to manage their existing online account with the bank. Story by Christopher Brown for NFC World.

Rakuten Banks on Credit Card Business to Counter Slower Growth
Struggling with declining profit and a surging Amazon.com, internet retailer Rakuten is leaning on its credit cards-the ones it issues to millions of Japanese. Rakuten, which operates an internet mall, said its credit card business posted 45% growth in operating profit for the July-September quarter, helping counteract a decline for the third quarter in a row in the company’s domestic e-commerce business. The company now gets nearly 40% of its revenue from financial services, operating Japan’s biggest internet bank and the third-largest credit company by transaction value. That helps it counter headwinds from slower growth and intensifying competition from Amazon in attracting virtual shoppers. Rakuten’s business model revolves around a point-based membership program that encourages people to use services such as travel booking and food delivery and pay for them with the company’s card. They can use their points on those services and purchases on the internet mall. Story by Alexander Martin and Takashi Mochizuki for The Wall Street Journal.

Holiday Shoppers Warned About Fake Apps and Fraud
Criminals are going after the databases of online merchants and trying to engineer an account takeover. The crooks don’t need to steal your credit card or debit card number. Instead, they use information found elsewhere, maybe via a breach, to gain access to your online account with a given retailer. Once they’re in, the crooks could get access to the credit card you had on store with the online retailer. They might order something online and pick it up in the store. Criminals know that many people re-use passwords, so they can hack into accounts using passwords obtained via other breaches. What are some ways to steer clear of the fraudsters this holiday season? Here are a few tips. Story by Susan Tompor for the Detroit Free Press.

EMV Chip Credit Cards Have Some Surprising Haters: Millennials
It’s been just over a year since the rules around credit card fraud changed, creating an incentive for banks to issue cards with EMV chips and merchants to accept them. Consumers have adapted well. According to a recent survey, 78% of Americans view EMV cards in a positive way. So if Americans approve of EMV, why are we seeing so many complaints? According to the survey, Millennials are the only generation to prefer traditional magstripe cards over EMV. Almost one-third of Millennials (31%) had negative feelings toward EMV chip cards, the survey found, the highest percentage of any age group. There are two major reasons why: longer transaction times and confusion about when to use the technology. Story by Erin El Issa for USA Today.

The Psychological Trick that Makes It Harder to Pay Off Your Credit Cards
Unlike your typical mortgage or car loan, credit cards are a door to open-ended debt. There exist no standard repayment plans, no deadlines to keep you on track. Beyond a token minimum each month, you’re free to mail in as much or as little money as you like. It turns out that the human mind is terrible at dealing with all that flexibility. Only a quarter to a third of credit card users pay off their bills in full every month. Most Americans carry a balance, and as new research shows, a surprising number of them pay close to the minimum each month-even when it’s clear that they could easily settle their debt faster and save a ton of money in interest payments. Too many Americans, it seems, have a broken understanding of what the minimum payment on their credit card means and what purpose it serves. In fact, as the research illustrates, minimum payments are a cunning tool, calibrated to extract as much profit from people as possible. Story by Jeff Guo for The Washington Post.

Exploring the Present and Future of Credit Card Processing
The foundation of the future of credit card processing will be based on two pillars: speed and efficiency. The companies that are staying ahead of the trends in the payments ecosystem have realized that these two factors are paramount for consumers. 25% of organizations stopped accepting cash altogether in 2015. And given that more individuals are managing their finances electronically, it’s natural that more companies will become cashless. To that end, mobile payments will be the wave of the future. Apple Pay, Samsung Pay, Chase Pay, Android Pay, Microsoft Wallet, Walmart Pay, Kohl’s Pay, and more will all become habitual for shoppers, who will reach for their phones instead of their wallets. Story by Andrew Meola for Business Insider.

LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.65 percent, slightly higher than the 14.60 percent last week. Six months ago, the average was 14.75 percent. One year ago, the average was 14.62 percent.


Ethoca and FICO Partner to Limit Card-Not-Present Fraud Losses

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Ethoca and FICO have partnered to make it easier for card issuers to maximize the recovery of card-not-present (CNP) fraud losses.

CNP fraud not only costs card issuers financially, but the inefficient chargeback processes also create a poor cardholder experience. Ethoca Alerts works with FICO’s Falcon Fraud Manager to provide a CNP fraud solution that works through every stage of the fraud lifecycle, including protection, prevention, alerting, investigation and recovery.

Card issuers who are already using Falcon can opt in to Ethoca’s network through direct integration. Ethoca Alerts will kick in when CNP fraud has been confirmed by a cardholder and their bank. When a card issuer confirms fraud, it will be flagged in Falcon, and Ethoca will distribute alerts to more than 5,000 merchants. The merchants can then act on the alerts by not fulfilling fraudulent orders and issuing the cardholders a refund. This process will take hours instead of the weeks that are now typical in the chargeback process.

“At FICO, we’re continuing to strengthen the arsenal of analytics-driven solutions we deliver to our clients and their ecosystem,” said Robert Duque-Ribeiro, Vice-President and General Manager for Fair Isaac Advisors at FICO. “Our partnership with Ethoca broadens our complement of fraud management solutions and expands the partnership between issuers and merchants. This first step in our partnership gives card issuing banks access to the largest card issuer-merchant collaboration network in the world. That means they are now able to recover issuer-liable fraud losses like 3D Secure transactions and low-value transactions they would normally write off, while making the recovery of merchant-liable CNP fraud transactions faster and much more cost-effective. Crucially, the speed with which the Falcon and Ethoca transmission can be effected now enables the card payment system to frustrate and prevent the criminals getting access to value, not simply stop the transaction.”

Identity Fraud Hit Record Highs in 2016

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The number of identity fraud victims hit a record high of 15.4 million U.S. consumers in 2016, a 16% increase, according to the 2017 Identity Fraud Study released today by Javelin Strategy & Research. The amount stolen in these attacks rose by nearly $1 billion to $16 billion.

The study also found card-not-present (CNP) fraud increased 40% last year, and that EMV cards may be driving criminals to open new accounts fraudulently. However, there is some good news. While fraudsters may becoming smarter at evading detection, consumers are getting better at detecting fraud, which has led to a lesser amount stolen per attempt.

The 2017 Identity Fraud Study, which is in its 14th year, found these four significant trends:

  • In 2016, 6.15% of all consumers became victims of identity fraud, which marks an increase of two million people from 2015. The number of incidents increased by 16% from 2015, which is the highest rate of incidents since Javelin began tracking identity fraud in 2003.
  • Due to an increase in EMV terminals and a growth in e- and m-commerce, many criminals are moving online, which led to a 40% increase in CNP fraud.
  • Account takeover (ATO) incidents and losses, which hit a record low in 2014, were once again on the rise in 2016. ATO incidents rose 31%, and losses increased 61% last year. On average, ATO victims paid $263 out-of-pocket costs and collectively spent 20.7 million hours resolving these issues in 2016, which is six million more than in 2015.
  • New-account fraud (NAF), which is when criminals open an account in someone else’s name, are on the rise. Since fraudsters are becoming better at avoiding detection, most victims discover the fraud by reviewing their credit report (15%) or when a debt collector contacts them (13%).

“After five years of relatively small growth or even decreases in fraud, this year’s findings drives home that fraudsters never rest and when one areas is closed, they adapt and find new approaches,” said Al Pascual, senior vice president, research director and head of fraud & security at Javelin Strategy & Research. “The rise of information available via data breaches is particularly troublesome for the industry and a boon for fraudsters. To successfully fight fraudsters, the industry needs to close security gaps and continue to improve and consumers must be proactive too.”

Research Shows Many Americans Fear Credit Card Fraud

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Data breaches rose 40% from 2015 to 2016, and this has left many Americans worried about credit card fraud. In fact, new research from Capital One shows 42.3% of their cardholders said superior fraud protection was the first or second most important feature when choosing a new rewards card.

Even with this concern, Americans still want credit cards. The Capital One Rewards Card Outlook found 32% believe a credit card can help them achieve their goals and dreams. Cardholders also want to take advantage of the latest technology. 40% of the respondents said they would prefer to keep their cards in a digital wallet. Millennials are especially eager to take advantage of this technology, as 58% of people in this age group said they want to use this feature.

Mobile wallets offer a number of security features. Wallets, such as the Capital One Wallet, offer instant purchase notifications so cardholders can tell if an unauthorized user is making a transaction on their card. It also allows users to lock and unlock their cards if they were lost or stolen. 13% of survey respondents had either lost or misplaced their credit card in the last year.

To cut down on credit card fraud, consumers should save their credit card receipts and compare them to their statement each month to help identify any fraudulent transactions. To assist cardholders, Capital One offers Second Look, a digital and mobile alert system that notifies cardmembers if a charge looks as if it might be a mistake. If the charge is incorrect or fraudulent, Capital One will help the cardholder resolve the issue.

The Capital Ones Rewards Card Outlook surveyed 1,000 Americans who have a travel rewards or cash back credit card.

LowCards.com Weekly Credit Card Update–March 3, 2017

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In-Car Payments: A Wallet that’s Truly Mobile
Soon your credit card will be able to go from 0 to 60 in about 6 seconds or less. Mobile wallets are moving to dashboards as automakers partner with card networks and retailers to equip vehicles with in-car payment technology. Drivers will be able to pay for parking spaces and gasoline without even getting out of their cars. Meanwhile, tech firms such as Amazon and Google are bringing their popular voice assistants to cars, providing consumers a way to buy products while they’re behind the wheel. In-car purchasing could be a bonanza for retailers and merchants, and a convenient shopping experience for consumers. Cardholders could also see new retailer discounts and opportunities to earn rewards and loyalty points as they shop inside their cars. Story by Brady Porche for Bankrate.

Mastercard’s Qkr Lets You Pay Bar Tab from Your Phone
Opening a bar tab is fairly common, but it can be pretty nerve-wracking. What if your credit card is stolen? Will another patron’s drinks be placed on your tab? What if you have one too many and leave it at the bar? New technology from Mastercard will soon make your happy hour life less stressful. The credit card company has created a digital payment tool, Qkr, that will allow you to open a bar tab through an app on your mobile phone instead of giving your payment card to the bartender. After you have opened the tab on your phone, you simply provide your server or bartender with a four-digit number. Then, when you’re ready to go, you can pay from your phone instead of waiting for service. The app utilizes Masterpass so transactions remain secure. Story by John Oldshue for LowCards.com.

First Major “Smart Toys” Data Leak Affects 2 Million Children
Innovative technologies are not just created for adults, everyone is able to get in on the fun. Children aren’t limited to hopscotch and marbles for entertainment anymore. Nowadays, kids can play learning games on the family tablet, video game apps and even take a drone helicopter out for a flight. For the younger children, you might want to stick with simpler toys, like an internet connected stuffed animal. But are these Internet-of-Things (IoT) toys safe? Unfortunately, not all of them are. It’s happened just as predicted: A major internet connected children’s toy has leaked the collected voices, email addresses and passwords of more than 2 million children and parents. And the manufacturer is hoping that no one will find out. Story by Mark Jones for Komando.com.

Most Small Business Owners Have Negative View of Mobile Banking
Small businesses are generally early adopters of technology, but a new survey conducted by RateWatch on the subject of mobile banking says otherwise. The perception of 69 percent of the respondents regarding this technology was not positive. Another data point in the survey corroborates this fact, as 34 percent never used mobile banking even though it was available to them. This goes against the trend in personal mobile banking, which according to a survey by the Federal Reserve, has increased by 39 percent in 2014 and 33 percent in 2013. So where is the divide between consumers and small businesses? Story by Michael Guta for Small Business Trends.

AmEx’s Platinum Card Gets a High-End Upgrade
Facing intense competition for its higher-spending customers, American Express is expanding the benefits it offers its high-end Platinum Card members, like a $200 credit on Uber. But those benefits will come with a higher annual fee. In addition to the Uber benefit, Platinum Card holders will also now be able to earn five points per dollar on hotels, American Express said Thursday. That’ll be as of March 30. Popular current benefits, like the $200 airline fee credit, airport lounge access or the five points per dollar spent on airlines, are staying. The annual fee, though, is rising to $550 from $450. Story by Ken Sweet for the Associated Press.

Yahoo CEO Marissa Mayer Loses Bonus And Stock Award Over Security Breach
CEO Marissa Mayer will not be paid her annual bonus, and will not receive a stock award after a Yahoo investigation found that two security breaches at the company were mishandled by senior executives. The probe by an independent board found that Yahoo senior executives failed to “properly comprehend or investigate” a 2014 security breach. In that breach, hackers penetrated Yahoo’s network and stole personal data from users. Another breach in 2013 was much larger and affected more than a billion accounts. In addition to the action against CEO Mayer, the company’s general counsel resigned without severance pay for his department’s response to the security lapses. Yahoo’s top security officer at the time of the 2014 breach left the company in 2015. Story by Doreen McCallister for NPR.

Global Mobile Economy Shows No Signs Of Slowdown
The mobile money market is continuing to not only grow, but also have an increasing impact on lives, economies and innovation. At the end of 2016, there are more than half a billion registered mobile money accounts available across 277 live services in 92 countries. Today, mobile money reaches roughly 66 percent of low- and middle-income markets, showing a huge achievement in the decade since the pioneering launch of M-Pesa in Kenya. Mobile money remains a key driver of economic growth and success in many emerging markets, specifically when it is used to formalize payments, increase transparency and boost gross domestic product. By the end of last year, mobile money providers processed 1.3 billion transactions, averaging nearly 30,000 transactions a minute. Story in PYMNTS.

Payroll Debit Cards Ruling Called Setback for Workers
Labor, consumer and good government groups are asking the state of New York to appeal a decision throwing out rules for payroll debit cards. About 13,000 businesses employing some 200,000 workers in New York pay those workers with debit cards. But some of those cards charge so many fees that workers can end up getting less than minimum wage. The state Department of Labor instituted rules to protect workers from exploitation, but New York’s Industrial Board of Appeals (IBA) overturned them. More than half of New York workers being paid with payroll debit cards earn less than $30,000 a year. Story by Andrea Sears for the Public News Service.

6 Tips on How to Protect Yourself from Credit Card Fraud
Credit cards are vulnerable to fraud. If you are not careful about how you use your card, your details can be stolen and used by other people. Thousands of dollars can be spent on illegal transactions before you even realise it. Although credit card issuers have sophisticated fraud detection techniques, there could be a situation where the fraudulent spends remain undetected and the final responsibility for payment falls upon you. Fortunately, there are several measures that you can take to protect yourself. Here are a few things you should bear in mind when using your credit card to avoid getting into a credit card scam. Story by for The Online Citizen.

LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.99 percent, identical to last week. Six months ago, the average was 14.64 percent. One year ago, the average was 14.81 percent.

LowCards.com Weekly Credit Card Update–April 21, 2017

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Mastercard Debuts A Credit Card With A Fingerprint Sensor To Fight Fraud
Swipe-to-pay, then chip-and-PIN. What next, credit cards with fingerprint sensors? Turns out that’s Mastercard’s latest invention, a new credit card with an integrated fingerprint sensor, which aims to fight in-store fraud. The card, currently under trial in South Africa, includes sensor is embedded in plastic of the credit card, allowing customers to authorize a payment with a fingerprint, rather than a PIN code or a signature. The payments giant said Thursday that the new biometric credit card will work on existing chip-and-PIN readers and won’t require store owners and businesses to buy any new hardware; though older magnetic stripe-only terminals will not be compatible. Story by Zack Whittaker for ZD Net

Major Changes Coming To How Your Credit Score Is Calculated
The math behind your credit score is getting an overhaul, with changes big enough that they might alter the behavior of both cautious spenders as well as riskier borrowers. Most notably for those with high scores: Abiding by the golden rule of “don’t close your credit card accounts” may now hurt your standing. On the other side, those with low scores may benefit from the removal of civil judgments, medical debts and tax liens as factors. The new method is being implemented later this year by VantageScore, a company created by the credit bureaus Experian, TransUnion and Equifax. It’s not as well-known as Fair Isaac Corp., whose FICO score is used for the vast majority of mortgages. But VantageScore handled 8 billion account applications last year, so if you applied for a credit card, that score was likely used to approve or deny you. Story for CNBC

AmEx’s Richer Rewards, Marketing Fuel Revenue After Costco Loss
American Express Co. is showing there’s life beyond Costco. The largest U.S. credit card issuer by purchases led the Dow Jones Industrial Average higher Thursday after reporting surprisingly strong first-quarter revenue a day earlier—evidence that sweeter rewards and a marketing campaign can help spur spending and blunt last year’s loss of a partnership with the warehouse retailer. AmEx shares rose 2.9 percent. Excluding Costco Wholesale Corp.’s contribution to year-earlier results, revenue rose 6.2 percent – an acceleration from the fourth-quarter’s 5 percent growth rate. Chief Executive Officer Ken Chenault stepped up spending on marketing last year and has sweetened rewards to keep customers after JPMorgan Chase introduced its Sapphire Reserve card in August, causing a temporary increase in attrition at AmEx. Those efforts, as well as a broader restructuring, seek to reinvigorate AmEx after its decision to part ways with Costco sparked the lender’s worst stock slump since the financial crisis. Story by Jennifer Surane for Bloomberg

Which Airline Credit Cards Can Save You From Getting Bumped?
Getting bumped from a flight can be a trying experience, as evidenced by the viral video of a passenger being removed from a United Airlines flight. While the situation hardly ever gets that extreme, many airlines overbook flights and getting bumped is a very real possibility for air travelers. If passengers want to keep their seats, having an airline-branded credit card can help. While having a certain card won’t directly help keep you on a plane, having elite frequent flier status often can, and many cards help holders attain that status. The big three U.S. airlines—United, American and Delta—have similar policies on bumping, which take frequent flier status into account. But their branded airline cards vary in their ability to help you earn elite status. Here’s a closer look at the policies of America’s three biggest airlines. Story by Myles Ma for MarketWatch

This New Luxury Card Competes With Amex Platinum And Chase Sapphire Reserve
Move over, Chase Sapphire Reserve, Citi Prestige and American Express Platinum. There’s a new, flashy travel credit card coming. U.S. Bank announced Thursday a new credit card, with an even longer name: the U.S. Bank Altitude Reserve Visa Infinite Card. New cardholders will get a bonus of 50,000 points when they sign up and spend $4,500 in the card’s first 90 days. Points are worth about 1.5 cents, when redeemed for travel, which makes the sign-up bonus worth $750 in travel credits. Cardholders also get a $325 annual travel credit, which is easy to cash in on: Consumers don’t have to be redeem them with certain airlines or hotel chains, but receive an automatic reimbursement when they make $325 in purchases on airlines, hotels, car rental companies, taxis, limousines, passenger trains and cruise lines.  More than 900,000 people signed up for Chase Sapphire Reserve in the fall of 2016 alone. It offered a 100,000-point sign-up bonus when it launched, which it later reduced to 50,000. In response, American Express this spring boosted its Platinum sign-up bonus from 40,000 to 60,000 points. The U.S. Bank card even looks similar to those cards, with a minimalist design with little writing on its front. It comes in metal, as both Chase and American Express’s cards do. Story by Maria LaMagna for MarketWatch

Why So Many Credit Cards Are From Delaware
Thumb through the credit card offers filling your mailbox, and you might notice a theme: Many have a Delaware return address. That’s no coincidence. Delaware is home to the credit card businesses of Chase, Discover and Barclaycard U.S., according to the Federal Deposit Insurance Corp.  Bank of America and Citi also maintain certain card operations there. Together, those issuers represent about half of the U.S. credit card market. Meanwhile, Delaware residents account for only 0.3% of the U.S. population. What’s behind the credit card industry’s love affair with Delaware? It all started with a court decision almost 40 years ago. Story by Claire Tsosie for Nerd Wallet

2016 InterContinental Hotels Breach Much Worse than Believed
In February, InterContinental Hotels Group reported they had suffered a data breach between August and December, 2016 that affected 12 locations. IHG, which is the parent company of Candlewood Suites, Crowne Plaza, Holiday Inn and Kimpton Hotels and Resorts, has now said in a statement the number is actually closer to 1,200. The hotel chain first learned of the incident in late December and hired cybersecurity professionals to help them investigate the situation. They discovered that cybercriminals had installed malware on the hotels’ payment card processing servers, which allowed the hackers to steal credit card holder names, numbers and internal verification codes. Story by Bill Hardekopf for LowCards.com

Bad Credit Card Loans Begin To Creep Up At Discover
Discover Financial Services is seeing its loan charge-offs move up meaningfully after several years of unusually low losses from customers who don’t repay their credit card loans. The loan-loss rate in February topped 3 percent. It was the first time in five years that Discover’s monthly charge-offs hit that level. To be sure, that figure remains more than manageable for Discover and in fact is on the low end of its annual write-offs historically. But Discover has for years been more cautious than many of its peers about the borrowers it approves and has enjoyed lower loan losses as a result. The difference now is that Discover also is enjoying unusually high loan growth. More borrowers are expected to default as a period of what analysts believe are unsustainably low charge-off levels ends. That raises concerns that this time Discover’s losses will mirror or even exceed the industry’s-whatever those turn out to be-as the credit cycle churns. Story by Steve Daniels for Crain’s Chicago Business

New York May Force Uber to Allow Credit Card Tips
Many New Yorkers use Uber because you don’t have to worry after you plug in your starting point and destination. You don’t have to worry about payment, and you really don’t have to worry about tipping. However, things might change over the next few months; New York City’s Taxi and Limousine Commission is proposing Uber and other credit card payment ride services allow the option to tip electronically. A petition created by the Independent Drivers Guild has gained 11,000 signatures in favor of electronic tipping as they strongly feel it will help drivers make a living wage. In October alone, rides used Uber 16 million times in New York. With numbers like that, it is understandable that drivers would want the opportunity to snag a little more money per ride. Still, many riders use Uber in part due to the convenience of not having to worry about tipping on a payment. Story by Max Goldberg for The Drive

Square Chief Teases A Smart Debit Card
Square Cash’s virtual payment card might not be quite so virtual in the future. Company chief Jack Dorsey has teased a strange, all-black Visa debit card that Recode suspects is really a physical Square Cash card. Square seriously considered a payment card back in 2014–the company is no stranger to exploring the concept of a real-world card that draws from online funds. There’s no guarantee that Square will launch a debit card, no matter what Dorsey is carrying in his pocket. The company reportedly ditched its payment card out of a reluctance to either antagonize its partners or wade through a tangled financial industry. However, there are a few incentives to at least consider the idea. For one, Square has previously said it would like to “own both sides of the counter.” Story by Jon Fingas for Engadget

CFPB Finalizes Delay of Prepaid Rule Effective Date
The Consumer Financial Protection Bureau today finalized a six-month extension of the effective date of its final rule on covered prepaid accounts. Originally scheduled to take effect on Oct. 1, it will now go into effect on April 1, 2018. The bureau said it will also revisit two thorny implementation issues through a separate rulemaking process. These issues relate to linking credit cards to digital wallets capable of storing funds and error resolution and limits on liability for prepaid accounts that are not registered or cannot be registered. Story in the ABA Banking Journal

LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 15.25 percent, identical to last week. Six months ago, the average was 14.61 percent. One year ago, the average was 14.76 percent.

LowCards.com Weekly Credit Card Update–May 19, 2017

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Delinquency Rates Rise For Student Loans, Credit Cards, and Auto Loans
A new report on debt and credit shows that in the first quarter of 2017, household debt just surpassed the previous peak of $12.7 trillion, seen during the Great Recession. Rising debt levels may become a problem. From the first quarter of 2009 to mid-2013, consumers paid down debt. Since mid-2013, households have taken on more debt. The composition of household debt has changed since the recession. During the housing bubble, mortgage debt made up the largest share of household debt. In 2006 and 2007, mortgage debt was over 73 percent of household debt. Today, mortgages make up 67 percent of household debt. As the share of mortgage debt has declined, the shares of auto loans and student loans have been rising. This quarter saw a notable uptick in credit card debt transitioning into delinquencies and in auto loans transitioning into serious delinquencies, while student loan transitions into serious delinquencies remained high. At the end of 2016, the 30-day delinquency rate on credit cards was 5.1 percent. In the first quarter of this year, the delinquency rate rose to 5.9 percent. The severely delinquent rate (90+ days) on credit cards increased from 3.5 percent to 4.1 percent. Story by Theodore Cangero for AIER.

Credit Card Limits Rise at the Top, Fall at the Bottom
The number of people with bank credit cards has passed pre-recession levels to reach a new high – 171.4 million – but only the consumers with the highest credit scores have seen a significant increase in the average amount of credit available to them. Since 2010, credit limits for “super prime” consumers increased by an average of $4,195, to $33,371, according to a report by TransUnion, one of the three major credit reporting bureaus, or companies that gather information used to calculate credit scores. For “subprime” consumers at the other end of the spectrum, credit lines decreased by an average of $1,069. Story by Melissa Lambarena for Nerd Wallet.

Nearly Half of Americans Don’t Pay Their Credit Card Bill in Full
Are you a “revolver” or a “transactor”? If you have an active credit card account, you fall into one of those categories. Based on recent data from the American Banker’s Association (ABA), you are far more likely to be a revolver (carrying a balance from month to month) than a transactor (paying off their complete balance each month), and that is good news for the credit card industry. According to the ABA’s Credit Card Market Monitor for the fourth quarter of 2016, revolvers hold 43.7% of all credit card accounts while transactors hold only 29.1%. The remaining 27.2% of accounts have no activity and are considered dormant. That means almost half of all credit card accounts – and 60% of active accounts – carry a balance. Story for KSDK.

Crime Confessions: How I Stole Your Credit Card
Roughly one in three Americans had their credit card information stolen in the past five years.  If identity thieves get your card, they can ring up a huge shopping bill and it can take months to undo the damage. Kevin Hawke, a former identity thief, told us how he operated. After serving prison time he wants to give back to the community by sharing his secrets so you can avoid becoming a victim of credit card fraud. Story by Kyle Iboshi for KGW.

China Opens Market Access to U.S. Credit Card Networks
Markets reacted coolly to what could be great news for card networks Visa and Mastercard given the U.S.-China access agreement announced late last week. While China opening market access to these firms and others could be a significant victory for the companies, investors have seen this play out before only to find many restrictions for the U.S. card networks to expand there. Analysts caution China might not necessarily adhere to this provision—the agreement doesn’t explain what would happen if China doesn’t create an even playing field for the networks—and said in the best-case scenario, it would still take a long time for Visa and Mastercard to gain significant market share there. Among the obstacles: working through Chinese government red tape and gaining more bank and merchant acceptance. Story by AnnaMaria Andriotis for Dow Jones Newswires.

Why Credit and Debit Card Fraud Alerts Have Spiked
Have you received a credit or debit card fraud alert recently? You’re not alone. Some 44% of U.S. adults have received a fraud alert in their lives for their credit or debit card, according to a new survey. That’s up from 38% who said in 2015 they had ever received a fraud alert. The fact that alerts have increased could be seen as a good thing. Banks and credit card companies have increasingly caught unusual behavior, and let customers know about it. But fraud alerts can also be an annoyance when they are sent by mistake. Some 37% of people surveyed said they were contacted about potentially fraudulent transactions, but all of their transactions were legitimate purchases. And worse, some scammers have taken advantage of the rise in fraud alerts. They have now begun posing as consumers’ banks and credit-card companies, even finding ways to call and text them with a caller ID that appears to legitimately be from those banks. It’s a tactic called “social engineering.” Story by Maria LaMagna for MarketWatch.

62% of Millennials Use Person-To-Person Payment Technology
The person-to-person (P2P) payment industry has seen tremendous growth over the last few years, particularly with young adults. Bank of America’s Trends in Consumer Mobility Report shows 36% of Americans use P2P technology, with 62% of Millennials sharing money digitally. For people who have not yet used P2P services, nearly half of Millennials, Gen Xers and Baby Boomers say they plan to in the coming months (47%, 48% and 49%, respectively). One in four seniors, the generation older than Baby Boomers, say they will use P2P payments in 2017. The majority of survey participants (68%) said they used P2P because it was convenient and faster than other money transfer options. Story by Bill Hardekopf for LowCards.com.

Google Is Turning Your Account Into a Mobile Wallet
Google is debuting a new way for consumers to use their Google credentials to pay for items in Android app, on the mobile web, or on a desktop website. The search giant has unveiled a new payments tool that lets developers of mobile apps and sites allow people paying for items to use a stored credit card in their Google Accounts. The new technology lets those hundreds of million of users who have stored a credit card with their Gmail, YouTube, or Google Play account be able to quickly purchase items within Android apps or on a mobile website. Users will see a “Pay with Google” button on apps where the new payments tool has been integrated and will be able to choose a credit card to pay with by logging in with their Google account email and password. It’s similar in some ways to Android Pay, a mobile wallet Google debuted that lets shoppers upload their credit and debit card information to the mobile app to pay for items in stores. The new API will work for Android Pay users as well, but the payments tool cannot be used for iPhone apps or for the desktop web. Story by Leena Rao for Fortune.

Chip Cards May Be Getting Faster Thanks to Mastercard’s M/Chip Fast Technology
Sure, they might be more secure, but in terms of quickness, chip cards seem to still have a ways to go. After all, swiping never seemed to take as long when inserting your credit card. Mastercard is hoping to ameliorate some of these frustrations, as it partners with “payments industry leaders to enhance and expedite the consumer checkout experience by leveraging the company’s M/Chip Fast technology.” And who are these leaders? First is Verifone, who will be incorporating M/Chip Fast into its products in the U.S. The M/Chip Fast technology is said to prioritize the parts of a transaction most important to security, thereby expediting the checkout process. And now that Verifone is adopting this methodology, the hope is that retailers across the country will soon see quicker checkout times. Global Payments will also make Mastercard’s technology available to merchants including fast food chains, grocery stores, transit vendors, and more, all of which value speed as a crucial component of the positive customer experience. Story by Lulu Chang for Digital Trends.

Credit Cards Gain Ground on Debit, Prepaid
The US purchase volume of credit, debit and prepaid cards increased 7% in 2016 compared to the previous year, according to The Nilson Report. That purchase volume hit $5.648 trillion, with the volume from American Express, Discover, Mastercard, and Visa credit cards increasing 8% year-on-year to reach a combined $3.059 trillion – the first time that figure has topped $3 trillion. The report shows a healthy and growing market for credit cards. By comparison, purchase volume for debit and prepaid cards increased only 5.8%, to $2.589 trillion. Credit cards also increased their market share in 2016, to 53.64%. That’s the fifth year in a row in which credit cards gained market share. American Express remained the largest issuer based on combined credit card purchase volume. Wells Fargo overtook Bank of America as the largest issuer based on debit and prepaid purchase volume. Story in Banking Technology.

LendUp Launches a Better Credit Card for People Looking to Improve Their Credit
LendUp has spent the last several years helping people who couldn’t get a loan build their credit and improve their financial well-being. Now the company is looking to empower those with little or no credit by giving them access to a credit card with low fees, financial education built in and incentives to spend less and pay off their balance. LendUp got its start providing an alternative to payday loans designed to be consumer-friendly and better for borrowers. With lower interest rates, an improved approval process and incentives designed to improve one’s credit and enable them to borrow more over time. The company was founded on a mission of financial empowerment, and the introduction of its credit card product provides one more tool its users can take advantage of. Designed for users with no credit or bad credit, the card features low fees, requires no security deposit and reports to all three major credit bureaus. Story by Ryan Lawler for Tech Crunch.

LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 15.25 percent, slightly lower than last week’s average of 15.26 percent. Six months ago, the average was 14.65 percent. One year ago, the average was 14.72 percent.

Russian Credit Card Fraud Gangs Offering Courses to Would-Be Crooks

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Risk management company Digital Shadows has recently uncovered remote learning “schools” offered by cybercriminal gangs. The six-week courses, which are only available to Russian speakers, include webinars, detailed notes, and course materials.

The courses, which cost $745 plus $200 for course fees, are taught over 20 lectures by 5 instructors. Advertisements promise the potential of making $12,000 per month based on a 40-hour work week. Since the average Russian monthly wage is less than $700 per month, this income would be attractive to many.

Digital Shadows also found that there appears to be a “code” among Russian cybercriminals, as many of these groups say that “students” cannot sell Russian credit card details. However, selling non-Russian card details is a lucrative endeavor. On two of the most popular “carding” forums on the Dark Web, Digital Shadows found 1.2 million card holder details.

The average price for credit card information is $6, but prices vary based on the level of security associated with the credit card. The least expensive are those that require additional authentication to “cash out.” Generally, these require a PIN, which can be difficult and time-consuming to discover. To get this information, criminals will call cardholders using social engineering techniques, which these courses teach their students. Instructors tell their students how to manipulate victims by gaining knowledge of the victim’s local area or building rapport. One instructor wrote, “that’s why I always advise to watch the news because with such incidents, it is possible to play beautifully.”

Digital Shadows also found that credit card criminals fall into four main groups:

  • Payment Card Data Harvesters steal credit card information through point-of-sale malware, skimming devices, phishing, database breaches, or operating botnets.
  • Distributors are middle men who generally make the most money. Unlike harvesters, who generally use the stolen credit card details themselves, distributors will package, repackage, and sell the card information.
  • Fraudsters are generally less technical than harvesters and are more likely to be caught by law enforcement. They generally acquire payment card information for a distributor and rely on online courses to learn the latest techniques.
  • Monetization actually encompasses many different roles. These individuals are generally tricked into operating drop addresses and are involved in reselling fraudulently acquired goods.

Rick Holland, VP Strategy at Digital Shadows said, “This ecosystem is highly complex and international. At each stage, it creates victims – from the card industry that loses $24 billion a year to consumers who are frequently duped into revealing their card details. One of the key themes that stood out for us is the level of ‘social engineering’ criminals are now using. Aggressive and manipulative phone calls to victims to reveal PIN numbers is just one example of this.”


LowCards.com Weekly Credit Card Update–August 25, 2017

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AmEx’s $300 Million Prepaid Tech Experiment Ends in a Sale
American Express is selling its prepaid-card technology to InComm Holdings as the lender continues its shift away from down-market customers. InComm, which is backed by private equity firm Warburg Pincus, will also become the exclusive program manager and processor for AmEx’s prepaid products, which include gift cards, business-to-business rewards, tax disbursements and reloadable cards, the companies said Thursday in a statement that didn’t include terms. The deal is expected to be completed in early 2018. AmEx last year dismantled its enterprise growth division, which was created in 2010 as part of an effort by the New York-based firm to broaden its appeal beyond affluent shoppers. The firm had acquired payments startup Revolution Money that year for about $300 million and renamed it Serve, using the technology to offer a line of reloadable prepaid cards that function as a digital alternative to a checking account. In 2012, American Express reached a deal with Wal-Mart Stores Inc. to expand sales of its Bluebird prepaid card. Story by Jennifer Surane for Bloomberg

35% of Americans Are Making This Easily Avoidable Money Mistake
Do you know how many automatic payments you’re making every month? If not, you’re not alone. Some 35% of Americans say they have made automatic payments to a subscription, or a membership service like a gym, and they didn’t even realize it. That’s according to a new survey from the credit-card website CreditCards.com, which asked 1,000 adults about their spending habits. Nearly half of people (48%) said the unexpected charges happened when they started a service as a free trial and then forgot to cancel it. Members of Generation X were the most likely to have signed up for auto-pay programs without realizing it. Some 44% did so, more than 2.5 times that of people ages 72 and over (17%). Parents are more likely than non-parents to be unwittingly enrolled in such a program (43% versus 32%). Plus, people with higher education and income levels are more likely to have been enrolled in an unwanted auto payment plan compared to respondents who make less than $30,000 per year and have an education level of high school or less. Story by Maria LaMagna for MarketWatch

MasterCard and Visa Investors Should Watch This Trend
Visa and Mastercard have thrived in the past few years, as Americans have become more financially secure and slowly become more comfortable taking out credit cards. Banks have been competing to offer generous incentives with new cards, helping prime the pump. But a recent report from the New York Fed indicates that Americans may now be binging too much on credit, and more of us are racking up delinquencies. That trend can sometimes be a red flag for credit card companies, particularly if banks get cold feet and start pulling back on lending. Total U.S. household debt hit a new record of $12.8 trillion in the second quarter, and credit card debt is at its highest level since 2009, according to the Fed. Delinquencies are generally a bigger problem for banks than credit card processors, because banks take the loss on the debt. But credit card companies do depend on banks being willing to issue more credit. If the banks end up on the hook for too many losses, they could pull back on issuing all those sweet rewards-filled cards. Story by Avi Salzman for Barron’s

Uber Relaunches Visa Rewards Program
On Wednesday, ridesharing platform Uber announced the relaunch of Visa Local Offers, a rewards program giving Uber riders around the country the ability to earn Uber credits by using the Visa card attached to their Uber accounts when spending at restaurants, shops and local businesses. Uber said Visa Local Offers is available from the Uber app, where riders can explore thousands of offers from featured merchants. There are no promo codes or coupons to manage. Once enrolled in the program, Uber credits will automatically start to add up in their Uber accounts when users spend with their eligible Visa cards at featured merchants. Uber said riders will need the latest version of the Uber app and an eligible U.S.-issued Visa card on their Uber accounts to enroll in Visa Local Offers. Story in PYMNTS

Digital Payments Now More Popular Than Cash
Digital payments are now popular than cash as app-based methods become more widely supported. Every major mobile operating system now comes with a built-in payment provider. Adoption amongst banks and retailers is also on the rise. Almost half of all consumers now prefer to make small transactions using an app. A recent survey found cash has slipped in popularity to 45 percent of consumers. Digital payments are now at 47 percent. The number of mobile transactions being made is rapidly increasing. Consumers are visiting bank stores and ATMs less frequently. People are becoming reliant on their phones, opting to keep less cash on their person and instead rely on Apple Pay, Android Pay or a similar solution. 46 percent of survey respondents said they use cash on fewer than eight days in a month. 5 percent claimed to never use cash, having entirely abandoned coins and notes for digital methods. Of those that do use cash, 76 percent keep less than $50 in their wallet. Almost half have less than $20. Story by James Walker for Digital Journal

Mobile Payment Company Square Just Opened Its First Brick-and-Mortar Store
Square, the mobile payment processing company and maker of the popular Square Card Reader, is opening its first brick-and-mortar location, a real-life showroom in the heart of New York’s lower Manhattan that’s part tech support center, part store and part showcase for curated products from Square customers. Starting this week, Square Showroom will function similarly to how Apple runs its Genius Bar, at least on weekdays, with customers booking appointments in advance. On weekends, it will be more like a pop-up store, with a selection of jewelry, bags, art, candles and other products from some of the companies that use Square. While Square started as a business focused primarily on startups that weren’t able to shoulder hefty credit card transaction fees, the company has become increasingly focused on addressing the needs of more complex customers dealing with payroll, invoices and other payments. Story by Marty Swant for Adweek

GreenMed Launches World’s First Cryptocurrency-Based Credit Card Processing App for Legal Marijuana Industry
Pro-cannabis cryptocurrency startup GreenMed has become the world’s first one-stop shop for electronic payments in the legal marijuana industry. The platform enables customers to pay for legal marijuana with credit and debit cards. Apart from allowing card payment at dispensaries, the platform also allows users to pre-purchase for quick pick-up over its app. GreenMed is the first platform to implement an ERC20 Ethereum token-backed application for the convenience of both customers and legal marijuana dispensary operators. Due to strict federal regulations, banks have been unable to partner with legal marijuana dispensaries, leaving cryptocurrencies like Ethereum as the only option to help the $5 billion industry accept mainstream electronic payments like credit/debit cards and electronic fund transfers. They can also choose to pay with digital currencies. Story in PR Newswire

American Express Ordered to Pay $96 Million by CFPB
American Express has been ordered by the Consumer Financial Protection Bureau (CFPB) to pay $96 million to customers in Puerto Rico and other U.S. territories. Federal regulators said they issued the fine because two subsidiaries of American Express harmed more than 200,000 customers by charging higher interest rates, enforcing stricter credit cutoffs and offering less debt forgiveness than customers in United States received. One discrepancy included introductory interest rates. From 2005 through 2013, more than two-thirds of the American Express credit cards available in Puerto Rico did not offer a 0% introductory interest rate, while 90% of similar cards in the U.S. mainland did offer this rate, according to the CFPB. The regulator also found when cardholders in U.S. territories defaulted on their debt, they were forced to pay at least 73% of what they owed to settle the matter, while customers in the mainland paid about 55%. Story by John Oldshue for LowCards.com

UK Credit And Debit Card Spending Growing? At Fastest Rate Since 2008
New UK figures show spending on credit, debit and charge cards is growing at the fastest rate since 2008, rising more than five times faster than earnings in a fresh sign of ballooning borrowing by consumers. The number of card transactions increased by 12.3% over the year to the end of June, coming amid a boom in consumer debt that has been raising alarm bells at the Bank of England. The pace of growth in card payments was 10.6% in the 12 months to the end of December. The figures illustrate a growing trend for card payments instead of cash and cheques, buoyed by contactless technology. They also underscore an alarming rate of growth for borrowing at a time when consumers are squeezed by rising inflation and a slower pace of wage growth. The consumer price index rose by 2.6% in July, while wages rose by just 2.1%. Story by Richard Partington for The Guardian

4 Credit Card Fraud Features You May Want
With identity theft reaching a new high last year, Americans are now more scared of someone stealing their credit card or Social Security number than of suffering a terrorist attack, according to a recent FICO survey. If there’s any good news from the 16% annual spike in card fraud, it’s that cardholders themselves are not paying the losses from this wave, at least not directly; those costs are absorbed by credit card issuers. But fraudulent activity creates the nuisance of replacing the card and inputting its information into your online accounts, as well as the worry that the fraudster may have accessed other personal data while stealing your card information. Card issuers are now deploying innovative anti-fraud tools to supplement their customary monitoring of transactions, and of alerts when they detect any suspicious activity. These four card features promise greater peace of mind and fewer hassles should your card be commandeered by a criminal. Story in Nasdaq

LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 15.41 percent, identical to last week. Six months ago, the average was 14.99 percent. One year ago, the average was 14.64 percent.

LowCards.com Weekly Credit Card Update–September 29, 2017

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Breach at Sonic Drive-In May Have Impacted Millions of Credit, Debit Cards
Sonic Drive-In, a fast-food chain with nearly 3,600 locations across 45 U.S. states, has acknowledged a breach affecting an unknown number of store payment systems. The ongoing breach may have led to a fire sale on millions of stolen credit and debit card accounts that are now being peddled in shadowy underground cybercrime stores, KrebsOnSecurity has learned. The first hints of a breach at Oklahoma City-based Sonic came last week when I began hearing from sources at multiple financial institutions who noticed a recent pattern of fraudulent transactions on cards that had all previously been used at Sonic. I directed several of these banking industry sources to have a look at a brand new batch of some five million credit and debit card accounts that were first put up for sale on Sept. 18 in a credit card theft bazaar called Joker’s Stash. Story by Brian Krebs for Krebs on Security

Equifax To Launch A Free Lifetime Credit Lock Service
Equifax’s new chief knows it’ll take a lot of effort to make people trust the credit reporting agency again. He started by penning a letter of apology published by The Wall Street Journal, wherein he admitted that the company wasn’t able to live up to people’s expectations. Equifax was hacked, he wrote — its website “did not function as it should have,” and its “call center couldn’t manage the volume of calls” the company received after the security breach was made public. The interim CEO has also revealed that Equifax will launch a new service on January 31st that will give you the power to lock and unlock your credit anytime. Best thing about the offer? It will be free for life to all its customers in the US. Story by Mariella Moon for Engadget

Nearly Half Of Americans Carry Credit Card Debt For At Least 2 Years
Nearly half of all U.S. adults who carry credit card debt-about 29 million people-say they’ve been carrying around a balance for at least two years now, according to a CreditCards.com study. Half of them (15 million) have been carrying the extra load for at least five years. The most likely offenders of debt were older Baby Boomers (age 63-71) at 63%, while the Silent Generation (ages 72+) followed at 57%. More than 50% of younger Millennials (ages 18-26) cited day-to-day expenses for their added debt, while only 35% of Generation Xers blamed their debt on simple life choices. Additional reasons included: retail purchases (16%), medical bills (12%), home repairs (10%), vacation expenses (10%) and car repairs (7%). People who make more money and have a higher education are more likely to carry debt than lower income, less educated and unemployed Americans. Story by Jade Scipioni for Fox Business

How To Fight Fraud By Updating Credit Card Terminals Before It’s Too Late
Seventy-five percent of companies experienced payment fraud in 2016, and half said the number of attacks increased over 2015. New industry standards and updated payment terminals technology can help protect businesses, but only if they take much-needed action. Today, businesses of every size rely on payments technology to transact and engage with customers. To get the best performance and to protect customers and sales, it is critical that software is always updated and compliant with security standards that deter fraud. SHA-2, the most current industry standard for payment encryption, is the best-available protection for the safety and security of credit card transactions. Not only is it recommended; soon, it will be mandatory. Currently, only about 40 percent of merchants are using SHA-2, and the remainder have until this December to convert to the new technology. Story by Laura Miller for The Business Journals

Equifax CEO Retires after Data Breach
Equifax CEO Richard Smith stepped down from his position after 12 years with the company. His immediate retirement comes on the heels of a huge data breach that affected 143 million Americans. The Chief Information Officer and Chief Security Officer announced their retirements last week, representing a major overhaul in Equifax’s executive officers. Former CEO Smith will not receive his annual bonus until the credit bureau has completed its data breach investigation. Smith can stay on Equifax’s health plan for life, and may be eligible for a retirement package of $18.48 million. If Smith is found at fault for the breach, the company may issue clawbacks or deny him a portion of his retirement. Story by Bill Hardekopf for LowCards.com

Here’s Why Experts Say You May Need A New Virtual Credit Card
About 15.4 million consumers were victims of fraud or identity theft last year. That’s an increase of 16 percent from 2015 and the highest total since 2004. Including all types of fraud, hackers stole $16 billion in 2016, and, according to a report from Credit.com, that number could rise to $8 trillion in the next five years. But there could be a new way to protect yourself: Virtual credit cards that provide only a temporary 16-digit card number, and, depending on the card issuer, a custom spending limit and an expiration date. Story by Shawn M. Carter for CNBC

Chime Raises $18 Million For Mobile Banking Without The Fees
It’s a bank account and debit card built for the digital age. Chime is raising $18 million in Series B financing for its mobile-first approach to banking. Without monthly fees or overdraft charges, Chime tries to appeal to the millennial generation, touting its affordability and easy-to-use app. Since launching in 2014, Chime has signed up 500,000 customers, who are typically in their late 20s and making between $50,000 and $70,000 per year. Chime gets its revenue from the accompanying debit card, where it earns about 1.5 percent in fees per transaction. Chime touts its optional automatic-saving tools, which can set aside a pre-determined amount of money or round-up to the next dollar on transactions, putting the spare change in savings. Story by Katie Roof for Tech Crunch

Express Yourself With The Thing You Rely On Most–Your Credit Card
Most of the things we use everyday can been heavily customized—there’s an entire industry around weird phone cases. When it comes to credit cards, something we use almost every day, it’s an entirely different story. This Kickstarter project wants you to be able to treat your credit card like your phone or computer, with personalized covers that you can change whenever you get bored of them. CUCU makes temporary covers for your credit card that are (apparently) easy to apply, peel off, and replace. It’s way easier and more fun than having to choose from the bank’s limited selection of customizable cards that are expensive, lame, and permanent. The art on the covers is quirky and cool, and with more than 300 designs you’re sure to find something you like every time. Story by Emily Heller for Mashable

Starbucks Now Lets You Reload Store Cards With Apple Pay On Apple Watch
Starbucks just made its Apple Watch app a whole lot more useful. You can reload your Starbucks Card using Apple Pay right on the Apple Watch. Paying with your Starbucks Card was previously supported but was possible with the built-in Wallet app; reloading required using the iPhone app. Apple first added the ability to use Apple Pay in apps with last year’s watchOS 3 software update. Few apps take advantage of this feature so far (Apple Store for watchOS lets you purchase favorite items using Apple Pay as one example), so it’s nice to see Starbucks finally making use of it. Most Starbucks locations actually let you pay directly with Apple Pay from the Apple Watch in stores, but using your debit or credit card and not a pre-loaded Starbucks Card doesn’t let you earn points and rewards. Story by Zac Hall for 9 to 5 Mac

LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 15.41 percent, identical to last week. Six months ago, the average was 15.21 percent. One year ago, the average was 14.64 percent.

Beware of These 5 Holiday Credit Card Scams

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You are probably using your credit card significantly more right now than you do throughout the year. Between gifts and travel expenses, the purchases add up quickly. Before you get too carried away, you need to be aware of some common credit card scams that take place around the holidays.

Fake Charities

It’s nice to make a charitable donation during the holiday season, but you need to make sure the funds actually go to a charity. There are many fake websites that steal your money or credit card information when you think you are making a donation.

Before submitting a payment to a charity, confirm their legitimacy through a state regulator or through a site like Charity Navigator. You could also donate to a charity using the PayPal Giving Fund. PayPal verifies the organization is a non-profit, and 100% of the donation goes to the charity. You also get added protection from PayPal because they will dispute a transaction for you if a scam is discovered.

Text- and Email-Based Donations

Sometimes the fake charities will use text messages and emails to solicit donations. You may receive a text that says, “Donate $XX to {organization} by replying “YES” to this message” or an email that provides a link for a donation. The messages may use the names of actual charities and even have logos and website designs that look similar to the original organization.

Rather than following through with those messages, contact the organization directly to make a donation. This will ensure your money goes to the cause, not the scammers.

Tempting Discounts

Most shoppers hunt for deals and discounts around this time of year because they have a lot of purchases to make. But don’t be fooled by specialty pricing. Some online stores may list products at severely discounted rates as a way to lure customers into placing an order. They may not send an item after the order has been placed, or they may send a knockoff that is as cheap as the price tag.

Only make purchases online through trusted websites and retailers, and be leery of prices that seem too good to be true.

Travel Sweepstakes

You may receive emails or see ads with special travel sweepstakes you can enter. Some of these are legitimate, but others are ploys to gather your personal information. If a travel sweepstakes asks for your credit card or bank information as part of the entry requirement, assume it is a fraud.

“Free” Subscription Packages

This isn’t necessarily a holiday credit card scam because it can occur throughout the year. However, these types of scams are more popular around the holidays because people are looking for creative gift ideas. You get the option for a “free” subscription to a website or service, and it may indeed be free for the first month or two. Eventually though, the company will charge the credit card you have on file if you do not cancel services within a certain length of time.

If you are signing up for a subscription that requires your credit card information, read the terms of use closely. Find out how much you will be charged after the free period is over, and make sure you cancel the subscription if you do not wish to continue with the paid version. Furthermore, you need to learn what the free trial entails—is it the full service, or just a sample of it? Don’t sign up for anything where you don’t have all the information.

Chip Cards Have Significantly Decreased Counterfeit Fraud in America

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According to Visa, 55% of storefronts in the United States now accept chip cards. In total, 2.3 million merchant locations are currently chip enabled, compared to just 766,000 in December 2015.

One of the biggest reasons retailers and card providers chose to switch to EMV technology is because chipped cards are more difficult to copy. It is fairly simple to gather information from a magnetic strip card and transfer it to another card, but the smartchips have special security measures to prevent that from happening. Visa reports  chip-enabled merchants have seen a 66% decline in frequency of counterfeit card fraud occurrences over the last two years, as well as a 58% decline in counterfeit fraud losses.

Chip card transactions continue to rise in America. Visa cardholders had 1.26 billion chip transactions in September 2017 totaling $59.4 billion. There were just 79 million transactions accounting for 4.8 billion in September 2015.

Not only are chip cards more secure than magnetic strip credit cards, but they may soon be just as quick to use. Slow transaction times has been one of the chief complaints among chip card users, but stores and payment processors have worked to make those transactions as efficient as possible. In April 2018, MasterCard, Visa and American Express will all do away with signature requirements for credit card transactions, making the process even faster.

Why Does it Take so Long to Respond to Cybersecurity Threats?

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Forever 21 announced late last week that a breach of their stores’ point-of-sale (POS) systems was worse than previously reported. The POS systems were accessed as early as April 3, 2017, but no one noticed the problem until mid-October.

In the time it typically takes a company to notice the issue and report it to customers, criminals could use the stolen information or sell it on the Dark Web for others to use. Why does it take companies so long to detect and respond to these cybersecurity threats?

Research from LogRhythm offers an explanation: inefficient systems are in place. The study surveyed IT professionals in the United States, United Kingdom and the Asia/Pacific region and found IT decision makers say their teams waste at least three hours a day on tasks that could be handled by software. The majority of those surveyed also believe cybersecurity professionals waste around 10 hours a week due to inadequate software.

Fortunately, most IT professionals think AI technologies will streamline these time-consuming processes, which will make it easier to detect and solve cybersecurity issues. Currently, fewer than half of the organizations studied by LogRhythm used AI technologies, but 90% of those using this cybersecurity software have seen a marked improvement in their response time.

Last month, Democratic lawmakers proposed legislation that would require companies to notify consumers within 30 days of discovering a data breach. But if it is taking a month to detect a problem, this still leaves Americans in danger of falling victim to credit card fraud or identity theft. Thus, companies must get better at monitoring security problems.

Has the Switch to EMV Caused an Increase in Card-Not-Present Fraud?

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America was once riddled with duplicate credit card fraud. Criminals would replicate data from a card’s magnetic strip and use it on a fake card to complete a transaction. When the country made the switch to EMV technology and smartchip credit cards, that threat began to subside. That’s the good news.

The bad news is that a new problem was created: card-not-present fraud, or CNP fraud. This typically occurs with online or over-the-phone transactions, where the merchant cannot physically inspect the card being used. As fraudsters looked for new ways to use stolen credit card data, many Americans worried that CNP fraud would spike like it did in the UK. Unfortunately, it has but the EMV switch may not be to blame.

According to Radial’s 2017 Fraud Index released yesterday, CNP fraud skyrocketed in many industries: over 300% in both the cosmetic and apparel industries between 2016 and 2017. In fact, CNP fraud rates increased in every industry last year with the exception of footwear.

EMV cards may have fueled some of this growth, but Radial believes it may also be the result of an increase in online shopping. In the last two months of 2017, Americans spent over $1 billion a day online for 58 out of 61 days. It’s no secret consumers are attracted to the convenience of online and mobile shopping, so the increase in CNP fraud may not be entirely from smartchip credit cards.

A study from 2016 revealed 12% of consumers would decrease their online shopping after experiencing card-not-present fraud, and another 12% would reduce their credit card usage altogether. 78% of shoppers wanted more protection for shopping online.

Merchants and credit card processors have worked to reduce CNP fraud in the last two years, with multi-layer security measures and two-step account authorizations. Consumers now have the option to use PayPal, Apple Pay or other platforms to buy products online, creating a buffer between their card information and the website.

Consumers Prefer Debit to Credit Cards—But is it a Good Idea?

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According to recent research, 61% of consumers in the United States say they prefer using their debit card over their credit card. This was a significant increase from the 52% a year ago. While it is a good idea to avoid credit card debt by only spending money you have in your checking account, is it good to always opt for debit over credit?

Due to identity theft concerns, paying with your debit card may not be a good idea. If someone steals your credit card number and makes unauthorized charges, you simply need to alert your credit card company, and they will generally reverse the charges.

But if someone were to use your debit card number fraudulently, the money will disappear from your checking account as soon as the purchase is made. By law, your bank can take up to 10 days to investigate the matter and return your money, which means you will not have access to these funds during this time.

In addition to fraud protection, using a credit card responsibly will help you build a positive credit history, which a debit card will not do. A good credit history will likely result in lower interest rates on your future mortgage and car loans. If you don’t use your credit card for a long period of time, the card issuer could potentially cancel your account. Since lenders like seeing a good mix of accounts on your credit history, not having a credit card can hurt you. Additionally, if you do not have credit, you could have just as difficult of a time getting loans as someone who has bad credit.

Credit cards offer a number of protections that do not come with other forms of payments. Many cards offer purchase protection, price protection, car rental insurance, travel insurance and a host of other features. Check your credit card agreement to see the additional and complimentary perks you receive by making transactions with your credit card.

Finally, many credit cards offer cash back, travel, or other rewards. When you use these credit cards responsibly, you can earn free rewards.

The only downside to using a credit card is the interest rate you will pay if you do not completely pay off your entire balance each month. But as long as you do, there is every reason to use your credit card to make purchases.


LowCards.com Weekly Credit Card Update–March 2, 2018

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Debt-Conscious Millennials Are a Threat to Credit Cards
Millennials have been accused of disrupting many industries, from newspapers to brick-and-mortar stores. Credit cards appear to be next in line. Just one out of three millennials carries plastic, according to a Bankrate.com survey, compared to the majority of older Americans. In addition, a Fed survey found the 18 to 24 demographic preferred to pay cash more than others. And if they do carry a card, it tends to be of the prepaid or debit variety. The 2008 global financial crisis and ballooning college tuition may have also scared some millennials away. Millennials are more likely than older generations to have student loans to pay. About 41 percent of them held such debt. And the burden is heavier, too. Story by Lisa Fu for Bloomberg

Credit Cards With Chips Are Reducing In-Store Fraud But Online Breaches Are Picking Up the Slack
Chip-based credit card readers, first introduced around 2011, have led to a 70 percent drop in counterfeit fraud in the United States, according to Visa. Visa says more 481 million chip cards are now in circulation, representing roughly 67 percent of all Visa debit and credit cards. The company also says that nearly two-thirds of US storefronts are using chip cards. Likely due to the fact that EMV cards have been widely adopted, CNP fraud (card not present) is on the rise. Increasingly, hackers are getting their hands on payment card information, and businesses are regularly leaking huge troves of credit card data online. The US leads the world in e-commerce sales, which suggests Americans are far more likely to fall victim to CNP fraud. Data breaches affecting American consumers hit an all-time high last year-up 45 percent from 2016, according to the Identity Theft Resource Center. Story by Dell Cameron for Gizmodo

Barclaycard Wants You to Dine and Dash Legally
Barclaycard is testing a new payment service that could mean the end to waiting for your bill at a restaurant. It’s called Dine & Dash, but in this version, dashing doesn’t mean skipping out on your tab. Instead, with this service, restaurant-goers would download the Dine & Dash app and just tap their phone on the Dine & Dash device at their table once they arrive. They would then order their meals and eat as usual, and once they were done, they could just leave. When the Dine & Dash app registers that the diners have left the restaurant, it will check them out and close the bill, issuing payment from whatever payment option was loaded into the app by the diner. For diners that want to split the bill with a pal, the app allows them to do that. It also allows users to add a tip and apply a discount code, and once everything’s all squared away, the Dine & Dash device lights up green to indicate the bill has been settled. The setup is similar to Mastercard’s Qkr tool. Story by Mallory Locklear for Engadget

Citigroup Will Refund $330 Million to Credit Card Customers it Overcharged
Citigroup said it would refund about $330 million to consumers after discovering it had overcharged 1.75 million credit card accounts on their annual interest rates. The company reports the average refund will amount to about $190 per account — including interest. Credit card issuers are required to semi-annually review accounts that experienced an interest rate increase to determine if those accounts are eligible for a rate reduction, according to the Credit Card Accountability, Responsibility, and Disclosure Act of 2009, known as the CARD act. Story by Anna Bahney for CNN

NAACP Files Racial Discrimination Lawsuit Against Capital One Bank
Over the past two years, Capital One Bank has been closing many of its brick-and-mortar locations around the state of Texas in what the bank claims to be a cost-cutting measure. The NAACP, however, has filed a lawsuit in federal court against the publicly traded company, alleging that its actions are discriminatory against its black and Latino customers, while also using black celebrities in its commercials to enhance its agenda. The suit, filed in federal court in the Southern District of Texas, alleges that black and Latino customers are encouraged to use ATM cards to transact their business with the bank, which reduces the possibility of minority customers applying for mortgages, credit, and traditional banking services. Story by Adedamola Agboola for Black Enterprise

How Banks Could Control Gun Sales if Washington Won’t
In the aftermath of the school shooting in Parkland and at a time when Washington shows little interest in limiting the sales of assault weapons—there’s a real opportunity for the business community to fill the void and prove that all that talk about moral responsibility isn’t hollow. What if the finance industry—credit card companies like Visa, Mastercard and American Express; credit card processors like First Data; and banks like JPMorgan Chase and Wells Fargo—were to effectively set new rules for the sales of guns in America? Collectively, they have more leverage over the gun industry than any lawmaker. And it wouldn’t be hard for them to take a stand. PayPal, Square, Stripe and Apple Pay announced years ago that they would not allow their services to be used for the sale of firearms. Story by Andrew Ross Sorkin for The New York Times

Mobile Bankers Beware: Sophisticated Hacks Soar
If you bank by phone, you better be careful. Malicious mobile-banking software aimed at taking over consumer bank accounts has threatened up to 10 percent of consumer cell phones, security experts warn. Worse, the software is so sophisticated that it can easily trick even savvy consumers into divulging their banking credentials to the crooks. Story by Kathy Kristof for Moneywatch

Supreme Court Case Seeks Disclosure of Credit Card Fees to Benefit Consumers
Every time a consumer swipes his or her credit card, the credit card company collects a fee. Do most consumers know this? Probably not. That’s because American Express rules prohibit retailers from educating consumers about these fees or giving consumers benefits for using lower-cost cards. Although retailers are fighting for the right to disclose these fees, credit card companies are determined to keep consumers in the dark. To change these rules, retailers support a lawsuit that will be argued before the U.S. Supreme Court on Monday. The case, Ohio et al. v. American Express, began when the federal government and 11 states sued American Express, claiming that its rules violate U.S. antitrust laws. Story by Deborah White for Fox News

MasterCard Strengthens Ties to Mobile Network Operators
MasterCard is strengthening its ties with mobile network operators with a new suite of services that are intended to help those companies better assist subscribers and small businesses connect to digital payment experiences. The card network has already helped MNOs such as Vodafone Ukraine, Digicel Group in the Caribbean, Viettel Telecom in Vietnam and Taiwan’s Chunghwa Telecom to roll out various services related to these new offerings such as Masterpass integration, direct carrier billing and QR code-based payments as well as data insights for small business to help them identify new opportunities. Story by Will Hernandez for Mobile Payments Today

Japanese Megabanks Team Up on Mobile Payments
Japan’s three megabanks are working together to standardize a smartphone payment system using QR codes, aiming to promote cashless transactions already widespread in China and elsewhere. Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group will work out specific plans by the end of March to unify QR code specifications across participating banks. The rollout of the payment system is slated for fiscal 2019. The three banks are also looking at establishing a jointly financed company to oversee the system. Cashless payments will greatly streamline bank operations while the use of QR codes will keep costs minimal for retail outlets that adopt the system. Story in Nikkei Asian Review

Nigerians are Turning to Virtual Debit Cards to Beat Restrictions on International e-Commerce
As a March deadline approaches to block Nigerian debit cards being used online on popular international sites like Netflix and Amazon, Nigerians have been scrambling for alternative payment platforms. Nigerian cards could be blocked as part of international sanctions imposed by a global group of financial intelligence agencies after Nigeria ran afoul of its rules. Some consumers are turning to a locally designed virtual payment card service as an option for those unwilling to use the country’s risky online payment black market. Story by Paul Adepoju for Quartz

LowCards.com Weekly Credit Card Update–March 9, 2018

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Amazon Wants to Make it Easier to Shop its Website Without a Credit Card
Amazon is in early talks with financial institutions including J.P. Morgan Chase to help launch checking account-like products, aimed at younger customers and those without bank accounts. This is the latest move by the e-commerce giant to solve one of the biggest barriers to shopping on its website: lack of a credit card. More than a quarter of U.S. households have no or limited access to checking and savings accounts. These so-called unbanked and underbanked households rely heavily cash or checks to fund their purchases, making shopping online difficult. Unbanked doesn’t necessarily mean unconnected, about 6 in 10 unbanked consumers have a smartphone, according to the Pew Charitable Trusts. Story by Lauren Hirsch for CNBC

Credit Card Losses Surge at Small Banks
Small banks have been fighting for a bigger piece of the credit-card market in search of higher returns. Now, they’re contending with rising losses. Missed payments on credit cards at small banks have risen sharply over the past year, a sign that their cardholders are taking on more debt than they can handle. Their charge-off rate, or the share of outstanding card balances written off as a loss after consumers failed to pay, hit 7.2% in the fourth quarter, up from 4.5% a year ago, according to Federal Reserve data. Concerns have been mounting in the broader credit-card industry about the recent trend of rising delinquencies. But they’ve especially surged at smaller banks, those outside the 100 largest by assets that have less than around $10.4 billion in assets. There, the average charge-off rate is near an eight-year high, while the 3.5% loss rate at large banks remains well below the 10.6% seen in 2010. Story by AnnaMaria Andriotis for The Wall Street Journal

This Credit Card Mistake Can Cost You a Lot of Money
I see it all the time. People want to help a partner, adult child or friend in financial trouble. Or they want to assist someone in building a good credit history so he or she can rent an apartment or buy a home. So they lend someone their credit card. Nearly half of current or former credit cardholders say they have let someone else use their credit card, according to a new survey. And it doesn’t end well for a lot of these folks. In fact, 35 percent of survey participants suffered negative consequences. People overspent on their card (19 percent), they weren’t repaid (14 percent) or their card was lost, stolen or never returned (10 percent). Story by Michelle Singletary for The Washington Post

This Credit Card Will Offer Rewards in Bitcoin
Instead of cash back, try crypto back. Thomas Harrison, a 25-year-old entrepreneur based in San Francisco, announced plans for a new credit card, Blockrize, that would offer cryptocurrency instead of cash back or travel rewards. He says there’s currently a 2,000-person waiting list, despite Blockrize still lacking a banking partner to issue the card. The card would offer 1% of the value of users’ purchases back in cryptocurrency, initially just BTCUSD and ethereum, every time they buy something. Harrison hopes the card will find a partner and be available to consumer by the end of 2018. Story by Maria LaMagna for MarketWatch

ATM Debit Card Fraud Hit 10 Percent In 2017
A new report has revealed that there was a 10 percent increase in the number of payment cards compromised at U.S. ATMs and merchants in 2017. Earlier this year, Diebold Nixdorf and NCR Corporation – the two biggest ATM makers in the world – warned that hackers are going after ATM machines in the U.S. with tools that can force the machines to spit out cash. A confidential alert was sent to banks from the U.S. Secret Service that hackers are targeting standalone ATMs that are usually found in drug stores, big-box retailers and drive-thru ATMs. Story in PYMNTS

Pennsylvania AG Says Uber Must Pay Up Over Data Breach
Uber’s got a new legal fight on its hands. Pennsylvania Attorney General Josh Shapiro on Monday filed a lawsuit against Uber after the San Francisco-based ride-sharing company took more than 12 months to inform users that it suffered a major hack. The attackers accessed the information of 25 million users in the US, 4.1 million of whom were drivers. The stolen data included names, email addresses, phone numbers and driver’s license numbers. Approximately 600,000 driver’s license numbers were compromised, but no credit card or Social Security numbers were stolen. About 13,500 of the affected Uber drivers lived in Pennsylvania. Story by Alfred Ng and Dara Kerr for CNet

Structural Changes at Mastercard Point to Centrality of Digital Services
Mastercard is planning to combine its physical and digital payments teams, and they will get a new leader. The changes appear to reflect the growing digitization of Mastercard’s business; while digital payments has for many years been perceived as a novel branch of mainstream payments, it is clearly now perceived by Mastercard as a part of the core payments business. This may point to an increasingly central role for Masterpass, Mastercard’s multi-channel digital payments platform, and also seems to reflect the growing importance of digital technologies like biometric fingerprint scans in card-based physical payments. Story by Alex Perala for Mobile ID World

US Consumers Might Be Willing to Pay for Better Mobile Payments Experience
Younger consumers are more willing to pay for a better mobile payments experience. Some 37 percent of U.S. consumers would be happy to pay more for a product or service if the mobile shopping experience is better, according to the Worldpay study. This number rises to 44 percent among consumers aged 18-24, who are twice as likely as older consumers (65+) are to reward brands that give them a “five-star” service. Story in Mobile Payments Today

166 Applebee’s Restaurants Hit With Payment Card Malware
Anyone who dined out at Applebee’s restaurants in 15 states – ranging from Alabama and Arizona to Texas and Wyoming – may have gotten a free side of payment card theft with their meal. RMH Franchise Holdings warned that of the 167 Applebee’s restaurants it owns and operates, 166 of them suffered a data breach in which point-of-sale systems were infected with malware designed to capture payment cards for anyone who dined at the restaurants. Infection periods vary by location, but the earliest infections began on Nov. 23, 2017, and none appear to have lasted longer than Jan. 2, the company says. It has not published an estimate of the number of payment cards that hackers compromised. RMH says it’s the second largest Applebee’s franchisee. Story by Mathew J. Schwartz for Bank Info Security

Weinstein Co. Sued Over $1.4 Million AmEx Balance
The unpaid bills continue to pile up for the Weinstein Co., as American Express filed a lawsuit Wednesday, claiming it is owed $1.4 million. The Weinstein Co. is teetering on the brink of bankruptcy, as talks with potential buyers Ron Burkle and Maria Contreras-Sweet broke down over the weekend. The company is also facing suits from various other business partners, including a Canadian film distributor and a manufacturer of chocolate truffles. According to the latest suit, the Weinstein Co. has refused to pay the balance on his charge account. As a result, AmEx has suspended the company’s corporate credit cards. Story by Gene Maddaus for Variety

The Hidden Dangers of Buying Virtual Currency Go Beyond a Simple Hack
That cryptocurrency you just bought is as vulnerable to hackers as your smartphone or any other digital device, security experts are warning. Virtual and increasingly popular currencies like bitcoin, Ethereum, and Litecoin are unregulated and volatile, making them not just a high-risk investment, but criminals can break into crypto exchanges, drain crypto wallets and infect individual computers with malware that steals cryptocurrency. A new report from Ernst & Young provides some of the first hard numbers on this new crime spree. EY analysts looked at 372 initial coin offerings that occurred between 2015 and 2017 and found that more than 10 percent of the funds—as much as $1.5 million a month—were stolen. Story by Herb Weisbaum for NBC News

NYPD Tests Low-Cost Tool to Combat Credit Card Skimming

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Credit card skimmers steal more than $1 billion every year from consumers in the United States, according to the Secret Service. Chip credit cards have done a good job in combating this sort of fraud, but smaller stores often cannot afford to upgrade their point-of-sales systems to the newer, more secure systems.

If a retailer is using an older system, criminals are able to install a “read head” on point-of-sale systems that copy a user’s credit card information when a card is swiped. The data is then automatically transmitted to the fraudster’s computer.

Engineers from the University of Florida may have a solution. The researchers created the “Skim Reaper,” which is a credit card-sized device that slides into a card reader and detects whether a skimmer has been installed on the system.

The Skim Reaper costs only $50. The NYPD has been testing the Skim Reaper and is happy with early results, according to the Washington Post.

Currently, the NYPD employs four detectives who are trained in uncovering skimming devices, but the Skim Reaper would allow even untrained officers to detect fraud. To use the device, a detective simply needs to slide the credit card-sized reader into the machine. This card is attached to a smartphone-sized device which displays “possible skimmer!” if the machine has been compromised.

Credit Card Fraud a Top Concern for Women Traveling Alone

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A new study from AIG Travel shows women are highly concerned about safety when traveling alone. Nearly half of respondents said they feel less safe while traveling now than they did five years ago, and 63% said they think about safety the entire time they are traveling.

Pick-pocketing was the biggest cause of concern, with 93% of women citing purse snatching as a primary safety risk on a trip. That was followed by credit card fraud at 86% and identity theft at 63%.

Credit card fraud and ID theft aren’t just concerns for women though. A separate study from Visa revealed payment card fraud was the second highest source of stress for global travelers, trailing slightly behind cash theft. Travelers also said card-related merchant fees, ATM fees and credit card disputes were high stressors.

Consumers can take a number of steps to ease the financial worries when planning for a trip:

  • Notify your credit card provider of your upcoming travels. This lowers the risk of having your card declined for suspicious activity.
  • Verify your card will work in your destination. Will you have access to free ATMs? If not, what fee will your credit card company charge for balance inquiries and withdrawals? The ATM may also charge a fee, so you will need to monitor your costs.
  • Know how to check your balance while traveling. You may not have access to the mobile app you typically use, so prepare to check by phone, by computer, or at an ATM.
  • Store your card and money in a thin pouch under your shirt. You can find these at most stores where luggage is sold. The pouch is discrete, and is difficult for pick-pocketers to access.
  • Do not rely solely on one card for your travel expenses. Keep some local currency on hand in case your card is lost, stolen, or locked for fraud, and consider bringing a second card for emergency purchases.

Counterfeit Fraud Down 76% Since America’s Switch to Chip Cards

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Counterfeit fraud continues to decline, thanks to America’s transition to chip payment cards. According to the latest research from Visa, the number of fraudulently copied credit cards used in stores dropped 76% from December 2015 to December 2017.

Nearly three million merchant locations now accept chip cards in the United States, up from 392,000 in 2015. Now, 63% of merchants accept chip cards, and 97% of March transactions were paid using EMV cards. That’s a total of $70.7 billion, compared to $59.4 billion in September 2017.

There are now 483.6 million chip cards in circulation, with slightly more debit cards (281.6 million) than credit cards (202 million).

While chip cards have reduced the risk of counterfeit fraud, many merchants are now combatting card-not-present fraud. This is most common for online transactions, where a physical card is not presented to a merchant. Fraudsters can use stolen card information to complete online purchases, as long as they have enough data to pass security protocols.

Between 2016 and 2017, CNP fraud increased in all categories except footwear, with some sectors seeing as much as a 300% increase in fraud. This may not entirely be the result of the EMV switch though. Online shopping as a whole has grown tremendously over the last few years, especially with stores integrating their in-person and online shopping experiences. For instance, Kohl’s now offers free shipping for purchases on their mobile app as long as the customer buys in store. Amazon continues to create new offers at Whole Foods, including 5% cash back for Prime Credit Card holders. As stores entice more customers to shop on the web, fraudsters will be drawn to the web as well.

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