This Week In Credit Card News: A Proposed Cap On Credit Card Rates; Buy Now Pay Later Usage Doubled Since 2021

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Republican Lawmaker Proposes 18% Cap connected Credit Card Interest Rates

Credit paper companies should beryllium barred from mounting liking rates higher than 18%, a Republican lawmaker from Missouri projected Tuesday. If passed, U.S. Senator Josh Hawley's bill, nan Capping Credit Card Interest Rates Act, would besides artifact credit paper companies from introducing caller fees aimed astatine evading nan headdress and penalize lenders pinch yearly percent rates that transcend 18%. Hawley's measure comes arsenic Americans are grappling pinch record-high in installments paper rates while carrying somewhat much than $1 trillion successful paper debt. The mean in installments paper complaint has been inching toward 21% for nan past 3 months and was 20.68% arsenic of past week, making it much costly for consumers to transportation balances, according to Bankrate data. [CBS News]

The number of group utilizing a bargain now, salary later action has doubled successful 2 years

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Buy Now Pay Later Usage successful U.S. Doubled Since 2021

Nearly a tenth of Americans, 8%, person utilized Buy Now Pay Later in installments financing for online purchases successful nan past year, a 2x summation since 2021, a YouGov study finds. Americans crossed each procreation person accrued take of BNPL since 2021, pinch millennials representing nan largest maturation conception (increasing by 91%). Meanwhile, online credit card usage among U.S. millennials has dropped by 4% during nan aforesaid clip period. The study identifies that among U.S. BNPL users, 49% person little than $1,000 saved versus 30% of nan wide population. [Payments Dive]

Credit Cards, Debit Cards Most Popular for Holiday Shopping

Rising liking rates and ostentation are expected to effect vacation shopping habits. Credit cards are expected to beryllium nan astir celebrated costs method for vacation shopping, according to a study by user financial services institution Bankrate. More than half (53%) of vacation shoppers opportunity they expect to salary for astatine slightest immoderate of their purchases pinch a in installments card, including 19% who opportunity they will return connected credit paper debt for their vacation purchases. Debit cards are a adjacent second, pinch 52% of shoppers readying to usage a debit card. Only 10% of vacation shoppers scheme to usage a buy-now, pay-later service, and 5% to scheme to salary pinch checks. [Chain Store Age]

Average Overdraft Price Hits 19-Year Low

The mean value of a user overdraft dropped by 11% this year, according to a caller study from Bankrate.com, arsenic nan banking manufacture continued moving distant from nan charges amid persistent regulatory pressure. Though astir banks still complaint overdrafts, nan mean interest fell to $26.61 from $29.80 past year, nan yearly study found. The fees peaked astatine $33.58 successful 2021. Larger banks started announcing overdraft reforms that year. Ally Bank eliminated overdraft fees, a move that Capital One and Citigroup would soon follow. Bank of America slashed its interest to $10, and a fewer location banks followed suit successful reducing nan charges. [American Banker]

Xbox Teams With Mastercard to Unveil First Credit Card

Microsoft-owned gaming level Xbox is debuting its first co-branded in installments paper successful nan U.S. The Barclays-issued Mastercard will beryllium disposable connected Sept. 21 exclusively to qualified Xbox Insiders crossed nan state earlier becoming unfastened to nan wide nationalist successful nan U.S. starting adjacent year. The paper comes pinch a assortment of perks, for illustration 3 months of Xbox Game Pass Ultimate for users who make their first acquisition wrong 180 days of opening their account, and 3X paper points connected definite streaming platforms and eating transportation services. [PYMNTS]

Delta to Slash Sky Club Access for Amex Card Holders, Change How You Earn Elite Status

Bad news, Delta fans: it’s soon going to beryllium a batch harder to entree Delta Sky Clubs and gain Medallion elite status. On nan Sky Club side, those pinch premium American Express cards will person their lounge entree trim from unlimited visits to arsenic fewer arsenic six visits per year, depending connected which paper they have. These changes return effect successful 2025. The hose will wholly alteration really it awards Medallion elite position adjacent year. Starting adjacent year, location will only beryllium 1 metric, Medallion Qualifying Dollar, and requirements are much higher than what they are today. And to make matters worse, nan MQD waiver offered by celebrated Delta in installments cards is going away. [CNN]

Hallmark Lets Consumers Venmo Gift Cards arsenic DoorDash and Costco Up Digital Too

To accommodate to nan evolving preferences of Gen Z shoppers erstwhile it comes to gift-giving, Hallmark is embracing modern avenues specified arsenic integer payments and mobile apps. In precocious August, Hallmark forged a business pinch Venmo to present complete a twelve co-branded beingness greeting cards. These cards, accessible online and astatine Hallmark, CVS and Walgreens outlets, characteristic a QR codification directing users to Venmo. The giver utilizes nan codification to transportation costs to nan recipient while nan recipient scans nan codification to person nan payment. These cards are disposable for acquisition astatine $4.99 each and travel successful a scope of themes, including “Happy Birthday” and “Best Christmas Ever.” Two years agone erstwhile Hallmark started integrating personalized videos into its beingness cards done QR codes. It besides introduced a mobile app that empowers customers to customize cards straight connected their smartphones. [PYMNTS]

A New 'Risk Score' Is Generated

Artificial intelligence is reaching into each corners of financial services, and that evidently includes payments. Mastercard is reporting it has introduced a caller solution that uses AI to make a “risk score” for transactions to measure nan legitimacy of nan personification connected nan receiving extremity of a integer payment. The move comes successful nan aftermath of real-time payments and nan charismatic preamble by nan Federal Reserve of its FedNow service. While it’s bully news for those making aliases expecting payments, it has besides opened nan doorway to fraudsters, making it easier for crooks who impersonate an individual aliases institution to instrumentality a personification into sending money and past to flight pinch nan funds. Known arsenic authorized push costs fraud, it has been increasing markedly successful nan United Kingdom and it’s expected to go a ample rumor successful nan U.S. arsenic real-time payments return greater hold. [CU Today]

Mastercard and Paysend Deepen Cross-Border Payments Tie-Up

Mastercard is extending its business pinch Paysend aimed astatine enhancing cross-border payments for small-and-medium-sized businesses (SMEs). SMEs are progressively seeking caller ways to nonstop money overseas aliases salary vendors astir nan globe. Indeed, contempt nan disparity successful standard betwixt SMEs and ample enterprises, mini firms dress up complete 98% of European imports and exports. Nearly 40% of SMEs surveyed successful a Mastercard study opportunity that cumbersome cross-border payments processes are slowing down their proviso chain, pinch a 4th stating that they had mislaid suppliers arsenic a result. [FinTech Magazine]

Do Gift Cards Need to Be Plastic? Hallmark, Blackhawk Test Paper Options

Facing rising costs paper environmental-impact concerns, paper networks and banks are switching from harmful virgin integrative to utilizing recycled and biodegradable materials for in installments and debit cards. Now gift cards are going greenish too, utilizing paper. Gift-card elephantine Blackhawk Network this period announced plans to rotation retired much sustainable paper-based versions of its Visa gift cards arsenic portion of a semipermanent scheme to extremity reliance connected first-use integrative for much than 700 cardinal cards nan institution helps nutrient annually. The first activity of paper-based Visa prepaid gift cards will rotation retired successful nan U.S., Canada and Australia opening this fall. [American Banker]

10 Ways to Reduce Your Credit Card Processing Fees

Swipe fees return a wound retired of astir non-cash payments. Reducing merchant in installments paper fees tin amended your bottommost line. But your strategy depends connected your transaction volume, industry, and customer base. Use these tips to little nan costs of processing in installments cards. [U.S. Chamber]

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