Credit Card Lowdown

Give Us Gifts With Cards, Say Europeans

Did you know Europeans love gifts with their cards? Well, at least that’s what a recent survey by MasterCard shows. The credit card provider recently published a survey claiming that the majority of cardholders all over Europe want a product that can offer them rewards.

According to the survey over 70 percent of the respondents said they preferred a card that offered them rewards. And they don’t believe in sharing these rewards either. That is at least 50 percent of these admitted that they would spend the points they received on themselves. This compares to the 25 per cent that would donate the points to charities and the 20 per cent that would treat their friends or family. Thriftyscot.co.uk reports:

Among the particular rewards that consumers expressed a preference for, 33 per cent said they would be most interested in discounted city breaks, while a quarter said they would like free cinema, theatre or concert tickets or free spa days.

Read more: MasterCard: Rewards most important to consumers

Wachovia Card For Businesses

Wachovia Corp. recently announced that it would offer credit cards for use by companies. The cards are the kind businesses give employees to pay travel and entertainment expenses, or to make purchases. Charlotte.com reports:

The cards will be available in the fourth quarter. They will be MasterCard brand. Wachovia's consumer cards are Visa brand.

Read more: Wachovia launches card for companies

Connecting Success With Contactless

It’s been nearly a year since each of the big three credit card providers rolled out their own contactless payment version and since the going has been unexpectedly good, it’s probably time to ask what’s next on their agenda. A lot, as it turns out, from different form factors, including watches, to use of mobile phones as a payment medium, to tapping and going your way through the New York Metro turnstile. Cr80news.com reports:

While the original credit cards capitalized on a "buy now, pay later, sometimes much later" philosophy, contactless cards are going after cash. While contactless won't spell the end of coins and dollar bills–at least in the foreseeable future-- it is tying in with what appears to be the consumer's desire to carry less currency. A recent survey commissioned by MasterCard shows that growing numbers of U. S. consumers are using less cash in favor of alternate payment methods, such as credit and debit cards.

Read more: One year after nationwide launches, big three U.S. payment card brands remain bullish on contactless

Are Visa and MasterCard charging too much? Your retailer thinks so

Visa and MasterCard are feeling the heat and how! They were on a roll until now as an increasing number of consumers resorted to plastic to beat the rise in costs. As gasoline rates increase, more customers are opting to use their credit cards to pay. So, what could be the problem?

Well, retailers are not too happy with how events are shaping up. They have gone to the extreme of asking Congress to step in and control certain procedures in credit card companies. Their main grouse relates to how much and in what way credit-card companies and issuing banks charge retailers for processing transactions. Retailers are asking for more regulation on interchange rates – the fee charged to retailers for processing a credit-card transaction. Washingtontimes.com reports:

Visa this week announced that it would make interchange rate factors available to participating retailers online, but only to those that sign a non-disclosure agreement.

Read more: Retailers seek fee rules for credit cards

All that you ever wanted to know about MasterCard® Credit Cards

MasterCard® was born in 1966 when a group of banks created a member-owned association. It has since moved from the earliest days of simple credit cards to the today’s contact-less and wireless payment options. In a way it has led the industry in driving this evolution, advancing global commerce and accelerating business development.

Today it has grown to a state wherein it offers personal cards of various types to suit different requirements. The range includes, debit cards, credit cards, gift and prepaid cards and MasterCard® PayPass. 

MasterCard credit cards help you enjoy the benefits, services, and superior purchasing power that come with it. The four basic types of credit cards on offer are:

• Standard Card -This card is for those individuals who are just starting out or starting to re-establish their credit.
• Gold Card – Offers all the amenities of a Standard MasterCard along with superior purchasing power for those who have a strong credit standing.
• Platinum Card – Offers its owner exceptional spending power for daily purchases and also big-ticket items. It also offers him an opportunity to earn rich rewards on purchases.
• World Card – Offers premier services and benefits by combining no pre-set spending limit along with an exceptional selection of personalized rewards.

WaMu's new gold debit card not a hit

Is WaMu's switch from Visa to MasterCard for their debit cards inconveniencing people? If initial reports are anything to go by, this new ‘gold’ debit card has failed to please and is not at all what it was touted to be. Seattlest.com reports:

Then we heard from Spud. And TypePad. And a few other places. And each time we had to go mess around in our account preferences and change the credit card number on file.

Read more: WaMu's New Gold Debit Card Proves Inconvenient

Stormy weather ahead for credit card companies

Card issuers and their partner banks are not in such good humor these days. Rather it would be more correct to say that they are in a state of panic. And why so? The reason is not apparent on the surface at least. I mean, at present, credit cards are having the run of the market. Consumers are indiscriminately using cards for all kinds of purchases and card companies, especially Visa and MasterCard have a steady flow of revenue thanks to the $800 bn credit card debt that Americans owe them. And MasterCard is especially on a roll as it gets ready to go public. So, what’s bothering them?

To know the answers, you need to scratch under the surface. Visa and MasterCard are today facing problems from all fronts. These range from the ongoing merchant lawsuit against hidden interchange fees, to competition from new card issuers. In case you didn’t know about the interchange fee fracas, well here’s the lowdown. Retailers and merchant have filed a lawsuit against Visa and MasterCard wherein they allege that they have been losing profits from sales in order to process card transactions. The main reason for these losses is the high rates for the fees, which are set by the card companies and issuing banks.

And here’s the biggest worry of them all – increasing numbers of consumers are actually getting rid of their cards! And guess what, people are no longer flocking in droves to get new credit cards. So there are not many new customers for these companies. Then there is the problem of increasing interest rates. All these problems seem to have come together, or they were probably brewing on the horizon for quite some time and have now decided to create a much-delayed storm.

Troubled times for credit card companies

It’s payback time for credit cards especially Visa and MasterCard. After having the run of the market for so many years, these two companies are now facing innumerable detractors whoa re filing merchant lawsuits against them. Consumeraffairs.com reports:

The lawsuit filed by retailers and merchants against Visa and MasterCard over "interchange" fees was recently amended to include debit cards as well as credit cards. The lawsuit deals with the processing fees merchants have to pay to card companies and issuing banks when customers buy goods using plastic.

Read more: Credit Card Companies Fear "Perfect Storm"

This youth brigade is financially savvy

Holidays are a time for overspending; for just forgetting how much money runs out your pockets. And when you come back from that lovely vacation with that beautiful tan, you are brought back to earth with a thud – thanks to your credit card bills. While popular media would love to have us believe that this is what the youngsters of today are up to, reality is something else altogether.

I know this sounds incredulous – okay, so some of us do overspend, but we do have more brains than our parents and seniors give us credit for. And we do know when enough is enough. So, while there is the occasional story of maxed-out credit cards, what you will most probably see now are 20 and 30-somethings who know what they are about and know where their finances are headed. And some of them have learnt their lesson the hard way – by battling enormous credit card debt. Mercurynews.com reports:

The others I spoke to said they spent only what they can afford to pay back in full when the MasterCard and Visa bills start coming next month.

Read more: Some young gift buyers set to pay bills

Web merchants fight Internet fraud

Credit card chargebacks are a way of life with most web-based companies and most of them had learnt to live with the inevitable loss of some money in the process of doing business. But now, more and more companies have begun to give fraudsters a run for their money and are refusing to give up without a good fight. I know all this sounds confusing so let’s start at the beginning.

Credit card chargeback is a payment fraud that saps hundreds of millions of dollars from online revenues of Internet-based companies. So, how does this kind of payment fraud happen? Let me explain with an example: A person orders a laptop from an online electronics company and offers to pay with his credit card. The laptop is shipped to him and his account is debited. However, after the due date, the person calls up the company and fraudulently claims that he hasn’t received the laptop. This would render the sale void and the person can then get his money and a free laptop as well. Alternately, the person could also claim that he did not order the product at all.

This just shows how easy it is for a customer to get a charge reversed. At the same time, it is extremely time-consuming for an Internet merchant to prove the sale was legitimate. Internet merchants suffer more from this kind of fraud because unlike a face-to-face sale, an online transaction does not require a customer's signature or credit card imprint.

However, now, Internet companies along with credit card firms are trying to fight back these fraudsters. Card companies are now offering payer-authentication services and other fraud-fighting tools and are also streamlining the process by which chargeback disputes are mediated. Visa and MasterCard already have some options available to merchants like a payer-authentication service, called ‘Verified by Visa’ for Visa cards and ‘SecureCode’ for MasterCard. If you are a cardholder registered with the programs, Internet retailers can ask for a password registered with your bank. This gives the retailer evidence of the purchase and advantage should a dispute arise.

And if you wanted to know what happened to the person who bought the laptop – well he first complained to the web-based company that he didn’t receive the laptop. When the company offered to send an FBI officer to his house to investigate, he immediately called back and informed them that he ‘just’ got the laptop!

Canceling charges are difficult with automated payments

It is the modern amenities and facilities that make life extremely smooth. But in case of a small error, these facilities can make life extremely difficult as well. I know you are probably wondering why I’m trying to sound philosophical when we are here to discuss credit cards. Well, this little bit does have something to do with credit cards, or rather, the automatic payment facility offered by certain credit card companies.

If you are one of those who make use of automatic payments to pay your bills, then here’s a bit of news for you. It can be extremely tiresome to cancel such arrangements. I know this should actually be a cakewalk. Now there didn’t seem to be any hitch when you signed up for the service so why the trouble now? Well, all one can say is, ‘such is life’. According to certain debt counselors, lawyers and Better Business Bureaus around the country, the number of complaints from consumers is increasing considerably. Most of them complain about their inability to stop the recurring bills charged to their bank accounts and credit cards. And to make matters worse, these rules differ depending on whether your payments are linked to a bank account or credit card. Now, unable to stand the frustration any longer, people have even begun filing lawsuits against vendors or their banks to keep the charges from recurring.

Meanwhile banks, which have been bearing the brunt of complaints, say that they are unable to cancel recurring credit-card charges when a consumer has signed a long-term contracts like an extended gym membership. However, things are not as bad as they sound. In response to this troublesome issue, credit card companies Visa USA and MasterCard International say they've upgraded their systems. The new system is supposed to help banks and consumers more efficiently stop automatic payments.

Tiring Taxes? Try using your credit cards

Tax season is well upon us and the IRS is busy giving last minute tax tips to the young recruits. You can now charge federal income taxes to an American Express, Discover, MasterCard, or VISA account by contacting one of the two companies authorized by the IRS to process credit card payments. Thecitizen.com reports:

There is no IRS fee for credit card payments; however, the service providers do charge a convenience fee based on the amount charged. Once you’ve completed the transaction, be sure to write down the confirmation number and the amount of your tax payment.

Read more: IRS gives last-minute tax tips

Are there minimum limits on credit cards?

Have you ever been in a situation where you buy a bag of crisps and a soft drink and try to pay with your credit card but are rebuffed by the clerk at the convenience store? S/he tells you that there is a minimum purchase to use a credit card and that your purchase is way below this amount. Are they allowed to do this? Wcpo.com reports:

But MSNBC says Visa and Mastercard do not allow stores to set minimum payments. Visa and Mastercard want as much business as possible.

Read more: CREDIT CARD MINIMUMS

Credit card companies mum on details of breach

While a large number of people are now aware that a computer attack compromised their credit and debit card numbers recently, quite a few of them have been finding it extremely difficult to know more details behind the breach and also how to defend against identity theft. According to consumer advocates, the lack of information comes as a move by Visa and MasterCard to control bad publicity. Nbc5i.com reports:

One North Texas woman's debit card information was stolen in a recent attack against a merchant's database. Her bank told NBC 5 News that Visa refused to provide details such as the identity of the merchant or when the breach occurred.

Read more: Credit Card Companies Decline Details On Breach

Card companies face increasing security breaches

Suspect transactions seem to have become the rule rather than exception as increasing numbers pop up throughout the United States and other countries. According to officials investigating the case, a large number of these transactions may be related to a security breach that happened at a merchant facility in California last year. The fallout from this event is only now becoming known. Visa USA was one of the first companies that gave an indication that everything was not all right. Recently released figures from the company indicate just 17% of 231 large retailers comply with industry wide data-security rules. Data-security experts believe that this is the proverbial tip of the iceberg. They believe that more such reports will be forthcoming in the next few months.

Sadly, most of the card companies have been trying to take adequate precautions to avoid just such a problem. Visa, MasterCard International, American Express Co., Discover Financial Services LLC, and other card companies harmonized their individual data-security rules into a common set of rules known as the Payment Card Industry data-security standard. This was done a year back. The rules mandate measures such as data encryption, firewalls, and regular anti-virus scans and apply to all organizations, including merchants, that handle card data. However, more than 80% of the large merchants are not yet in compliance.

Businesses can use credit cards for taxes

I am not one of those who subscribe to the idea of having multiple credit cards and flashing them wherever I go. My belief is that credit cards and their use doesn’t spell good news unless you are a careful and thrifty spender. But every once in a while, credit card companies, and sometimes the government spring certain surprises that make me want to change my opinion that credit cards are dangerous.

So, now that I’ve psyched you enough, let’s get on with the news. If you are a businessperson, then get your credit card out and ready for the IRS. The IRS or Internal Revenue Service has now begun accepting credit card payments for certain business taxes. Another piece of good news is that the convenience fee paid or incurred by a business making a tax payment with a credit card can be deducted as a business expense.

In case you are interested in making secure federal tax payments with your American Express, Discover, MasterCard and Visa cards, all you need to do is visit their official site at officialpayments.com

A look at the Chase Platinum

Did you know that there are nearly 1000 Chase credit cards for consumers to choose from? If you didn’t, then join the gang. Not many people are aware about this awesome number. Most of these cards are ‘affinity’ cards. This means they have direct tie-ins with certain types of stores or manufacturers. While you may have encountered a few of these cards at some point of time, let’s have a look at one card that seems to stand above the rest of the Chase cards.

The Chase Platinum is the one of the most popular Chase cards. You can get it as the Chase Platinum MasterCard or Chase Platinum VISA card. Its plus points include 0% APR for the first 12 months. It has no annual fee; a fixed low rate once the introductory period is over; and lots of other benefits.

Reward cards

What type of credit card do you hold – regular or reward card. Chances are you already have a reward card with your regular credit card or are planning to get one soon. So what is it about these cash-back cards that have people gunning for them? It’s simple human nature. Not many people can say no to rewards that are offered for doing what you like to do most – shop. It’s just too tempting. So let’s have a look at this segment of the credit card market, which is growing at an enormous rate – at last count, over 32 million people across the country were using reward cards!

The credit card industry is not known for its generosity. On the contrary, high interest rates, and changing terms and conditions are more de rigueur in this industry. So the very fact that these companies are today offering cash or rewards to people who shop with their cards may sound a bit absurd. But not when you realize that they are now banking on something businesses have done from time immemorial – customer loyalty.

When any credit card company offers a cash-back or reward scheme for using its credit card, customers are known to usually use this particular card more than the regular ones. So now you have companies like Discover giving away almost $500 million in 2005 alone. Discover was the company that introduced the cash-back scheme nearly two decades ago. Soon other credit card companies like American Express, Citibank, Visa, and many others were offering reward cards and business was booming.

So how good are these cards for customers? Do they come with some hidden charges or are they simply what they claim to be? Questions any persons should ask him/herself before going in for a reward card.

If you were to go by customer surveys, this industry is yet to peak. People are in general very happy with these cards. Only one thing, you need to find out which card suits you and your wallet best. You only need to remember one thing: your choice of card depends on what kind of shopper you are – you buy books, grocery, or clothes. So it is important to know more about every card before you choose the one that is right for you.

High fees for multiple-use gift card

Beware! The ‘multiple-use’ gift card that you received this Christmas may not be as great a gift as you thought it would be – especially if you are living in Connecticut. You may end up paying a huge sum as fees on these types of gift cards, which are issued through American Express, Discover, MasterCard or Visa. This despite the fact that a Connecticut law prohibits inactivity fees and expiration dates on gift cards. The catch here is that the law still does not apply on multiple-use gift cards.

But the stringent rules have ensured that at least some of the card issuers stay out of the state. While Discover Card does not offer gift cards in Connecticut, American Express does not sell its cards directly to Connecticut residents.

What has irked state representatives are the numerous types of fees that the issuing companies charge for a small gift card. When you get a multiple-use gift card, you not only have an expiration date, you have to pay a purchase fee, inactivity fee and even a processing fee if you want any money that remains on the card after you’ve used it to be returned to you.