EBay to Stop Taking American Express After Fee Dispute
EBay will drop American Express cards as a payment option because of “unacceptably high fees.” EBay notified customers about the change, which is set to take effect Aug. 17. The two firms have been embroiled in negotiations around the merchant discount rates, also known as interchange fees, charged by Amex at the point of sale. The fees, imposed each time a card is used in a transaction, have long been a headache for merchants. Amex, however, said its research shows that its fees are comparable to what eBay must pay to accept similar cards on other networks, such as Visa and Mastercard, while providing more value. [Bloomberg]
Borrowers, Especially the Young, Struggle with Credit Card Debt in Potentially Bad Sign for Economy
Consumers are increasingly struggling to pay their credit card bills, raising concerns about severe delinquencies spiraling and sapping consumer spending. Those in their 20s and 30s are having the most difficulty paying their credit card bills. Those age groups typically have a mix of less earnings power and lower savings. Consumer spending fuels economic growth, so trouble paying credit card bills is a worrisome signal. The direction of the labor market could determine whether debt stress becomes a bigger concern. Job and wage growth helped counter the hit to consumers wallets from rising inflation, but a continued slowdown or reversal there could tip the scales. [Associated Press]
Apple Pay Overtakes PayPal as Favored In-Store Mobile Wallet
A PYMNTS study found that, at the start of 2022, PayPal was retail customers’ digital wallet of choice, and it was not even close. However, in the time since, Apple Pay has taken the lead. The Apple-owned digital wallet briefly surpassed the former favorite online payments system in the first quarter of last year before falling behind again. However, as of the first quarter of this year, Apple is ahead, and in the second quarter, that lead only continued to widen. [PYMNTS]
Australia Moves to Rein In Buy-Now-Pay-Later with Credit Check Law
The Australian government on Wednesday introduced legislation that would require buy-now-pay-later firms to run credit checks on borrowers, aiming to regulate the rapidly growing sector popular among youth like other consumer credit products. Up to now, the sector has avoided rules that apply to credit card providers as BNPL firms make most of their revenue through merchant fees, rather than interest payments. Under the proposed new laws, BNPL providers must hold an Australian credit license, putting them under the watch of the corporate regulator, the Australian Securities and Investments Commission. [Reuters]
Retail Shoppers Pay by Debit Card in Stores But by Credit Online
According to an October survey of more than 2,100 U.S. consumers, 44% of respondents had paid for their most recent retail purchase in stores via debit card, while 28% paid with a credit card. Conversely, 41% of consumers surveyed had paid for their most recent online retail purchase using a credit card, a greater share than said the same of any other payment method, while 36% used a debit card. [PYMNTS]
Financial Dangers of Store Credit Cards Can Be Severe
Nearly every store has rewards credit cards available for customers, but not all the offers add up to major savings. These offers are often the “genesis” of long-term issues. Store credit cards are similar to other “spaving” ploys from retailers designed to make consumers spend more to save. Unlike other deals, like buy one, get one sales, credit cards come with long-term financial risks. Retailers offer consumers two card options – a store card only accepted at a certain retailer or family of brands and a co-branded card that can be used widely. The cards are primarily pitched to consumers at point-of-purchase rather than having to complete an application process or go to the bank. The quick sales-pitch nature of the card pitch can “rope in” unsuspecting consumers and prompt a “trickle down” effect on their financial plans. [Fox Business]
Criminals Are Stealing Food Money from Poor Americans by Exploiting Obsolete Debit Cards
EBT cards—which deliver Supplemental Nutrition Assistance Program (SNAP), Temporary Assistance for Needy Families (TANF), and other state-run assistance—work like debit cards at stores when buying groceries and at ATMs when withdrawing cash. But they lack a crucial security feature that everyday debit and credit cards carry, a small computer chip that is nearly impossible to clone. Instead, EBT cards depend on the old-school magnetic stripe for security. The stripe contains all the information to clone the card, data that can be picked up by an illegal card reader over a legitimate one at a store or ATM when a card is swiped. [Yahoo Finance]
Binance Reinstates Crypto Buys Via Mastercard
Binance, the world’s largest cryptocurrency exchange, will once again allow its customers to purchase cryptocurrencies using Mastercard. Binance has resumed cryptocurrency purchases via bank transfers using Mastercard debit and credit cards for “smooth transactions.” On the Binance platform, the “buy crypto” options via Mastercard have been reenabled, with a maximum one-time purchase of up to 5,000 euros, worth approximately $5,440 for euro-based transactions, and up to $20,000 for United States dollar-based purchases. [Coin Telegraph]
Seattle Tries New Approach for Treating Addiction: Gift Cards
A new program is being offered in Seattle that ties small financial rewards to reducing, or eliminating, substance use. It’s called “contingency management,” an inscrutably dry name for trying the carrot instead of the stick to help people fight their addictions. Seattle City Hall’s interest comes as King County sees a record number of overdose deaths, the majority of which involve both fentanyl and methamphetamine. More than 1,330 people died of overdoses in 2023. So far in 2024, nearly 500 people have died from drugs and alcohol. Seattle’s program is in its infancy. Washington is one of two states in the country allowed by public insurance to try these programs and Seattle is now among a handful of places in Washington running a pilot program. [Seattle Times]
How to Get Help with Your Credit Card Debt, According to Experts
With the costs rising for nearly everything due to high and persistent inflation, it’s no surprise that many Americans are turning to credit cards to help pay for essentials. But while this approach can help fill in the gaps in your budget, it comes at a hefty price. According to the Federal Reserve Bank of New York, Americans currently collectively owe $1.12 trillion in credit card debt. And, the average American now owes almost $8,000 in credit card debt despite annual percentage rates on credit cards having almost doubled in the last decade. The average credit card rate is now close to 23%. These factors can make credit card debt hard to tackle. And, some cardholders are facing even higher credit card balances than the average, so it’s important to know how to get help with this type of debt if and when you need it. [CBS News]
These Capital One Credit Cards Will No Longer Include Airport Lounge Access in 2025
For frequent travelers, getting complete access to airport lounges can be a valuable credit card perk, but some card issuers are doing away with this benefit. In 2024, the Capital One Venture Rewards Credit Card and Capital One Spark 2X Miles cards will no longer offer two complimentary airport lounge visits annually. The premium Capital One Venture X Rewards Credit Card will continue to include free airport lounge access. [The Motley Fool]
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