This Week In Credit Card News: Card Rewards Are Evolving But Are They Unfair To Lower Income People?

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Will Congress take away your credit card?

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How would you feel about Congress taking away your credit card or preventing you from participating in credit card reward programs? do not laugh. Left-wing groups in Washington are declaring that the plastic card in your wallet is a financial villain that needs to be put to rest. A new study by researchers at the Federal Reserve Bank of Boston has found that credit card reward programs are unfair because they provide “an implicit money transfer” to wealthy cardholders from low-income people who buy things with cash or debit cards. [Real Clear Politics]

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Cash Back, Miles or Wine? Credit card rewards are evolving

Rewards credit cards typically come in two basic flavors: cash back and travel. But many new credit cards are re-imagining the role that a rewards program can play in your life. These cards can help encourage certain behaviors, and offer greater personalization. While these startups don’t have the brand recognition and deep pockets of big banks, they do have one thing in their favor: speed. Some financial startups rely on the services of other tech companies to provide the infrastructure (including selecting a bank partner and payment network, and establishing underwriting guidelines) to launch a new credit card. This makes it easier to turn an idea into a reality. [NerdWallet]

Why Congress Should Now Regulate Cryptocurrencies

On Wednesday, the US House Committee on Financial Services hosted a hearing on cryptocurrencies and fintech, on the heels of the Treasury Department report on stablecoins published last month. Executives from major industry players will address the risks that stablecoins and other cryptocurrency technologies pose, and they will identify opportunities to improve consumer protection and prevent illegal activities such as ransomware targeting, money laundering and terrorism financing. Regulators must now create clear rules of the road to balance innovation with mitigation of risk. The ability of these digital currencies to undermine the control of the monetary system and thus erode sanctions power presents a particular risk to the United States. [Foreign Policy]

Amex unveils 2 new Platinum card designs

From adding a range of new benefits, to increasing the intro bonus and increasing the annual fee to $695, Amex is doing a lot of tinkering. American Express Platinum Card this year. And now another change has been made to this iconic card. Amex is introducing two new card designs in early 2022, and they will be available to new and existing cardholders in addition to the classic card style. [Business Insider]

Chase Bank’s new program to help customers avoid overdraft fees

The country’s largest bank, Chase Bank, announced four major changes related to the overdraft picture. Chase is keeping its $34 overdraft fee, and Chase customers can be charged a maximum of three overdraft fees per day. But next year, Chase will introduce a next-day grace period where customers will have until the end of the next business day to correct the shortfall and add money to bring back the balance where the customer will have to pay $50 to avoid the fee. Less than or more can be withdrawn from the previous day. In addition, Chase will offer its customers early direct deposit, helping customers gain access to their paychecks that are deposited directly in up to two business days. [Detroit Free Press]

Another new premium travel card hits the market

2021 has been a remarkable year for new and innovative premium rewards cards. Now, another issuer is joining that group with its latest product: the Bank of America Premium Rewards Elite Credit Card. With an annual fee of $550, the card is targeted at Bank of America’s high- and ultra-high-net-worth customers. But it is not specific to that customer base, and you do not need to have a relationship with a bank to apply. [The Points Guy]

Buy now, pay later Services are thriving

According to a new report from Adobe Analytics, buy now, pay later platforms like Klarna and Affirm were up over 20% on Cyber ​​Monday last year. Millennials and Gen Z are the biggest users. They are using companies as a budget alternative to credit cards they may be afraid of or may not have access to. In fact, around 90% of the payments processed by the platform Afterpay are done with debit cards. Afterpay customers typically spend more money: With Afterpay the average shopping cart at clothing retailers is increased by 20%. [Marketplace]

Fraudulent e-commerce transactions spiked between Thanksgiving and Cyber ​​Monday

TransUnion’s report shows that 17.46% of all global e-commerce transactions between Thanksgiving and Cyber ​​Monday were potentially fraudulent. Those numbers were slightly higher in the US where 19.66% were suspected fraudsters. The number of suspected e-commerce fraud attempts during the 2021 holiday shopping season was also 25% higher than the 15.73% fraud attempts seen earlier in the year (January 1 to November 29). The top two reasons for potentially fraudulent e-commerce transactions are: the number of accounts per device, which are triggered when a device has reached the minimum number of accounts during a specified time period; And there was other evidence, which is when an account or device has already had a fraudulent transaction. [Help Net Security]

Smart credit card: The X1 card hits the scene

The X1 card was recently unveiled, offering a host of unique security and rewards features. Advertised as 17g stainless steel, the card will be delivered to you in a branded box. You cannot “apply” for it; You may request an invitation to apply by submitting your name, email address and income. The X1 says its credit card offers up to five times the spending limit of a traditional credit card, with an average credit limit of $24,300. This potentially gives cardholders a chance to enhance their credit score by improving credit utilization. And it has automated virtual cards, which give you a unique, one-time credit card number every time you shop online. [CNet]

About 60% are unsure if high credit card balances low credit scores

According to a new survey, most Americans are unclear about how their credit card balance affects credit scores. For those who indicate that they understand that there is a connection between the two, nearly four out of 10 people say that a high credit card balance raises their credit score, which is false. [U.S. News]

Con artist favors Target in gift card scams as fraud costs rise

The Federal Trade Commission said that in the first nine months of 2021, consumers lost more money in impersonation gift card scams than they did in 2020. Consumers reported that they lost $148 million in scams so far this year in which they were asked by scammers to buy gift cards to use as payment. The FTC said that about 40,000 consumers made the report, in which they said they paid con artists who were impersonating large companies or government agencies. Target gift cards were the most popular option for scammers in reports obtained by the FTC. []


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