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March 2002
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(3/28/02)
Teen Card
As teen payment cards struggle to catch on, Citibank this week launched a prepaid MasterCard aimed at students between 13 and 18 years of age. The Citi Cash Card for Students will carry a $25 annual fee and a $1.50 per transaction load-fee.
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(3/27/02)
IRS Probe
If you've been hiding income in a tax haven country and using a credit card to access the funds you could be in big trouble. The Internal Revenue Service is reviewing hundreds of thousands of such accounts and may be sending some tax cheats to jail. The IRS confirmed this week it has already received account records on nearly 250,000 MasterCard accounts issued by banks in tax haven countries. v
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(3/26/02)
Debt Counseling
A three-year study on the change in consumer financial behavior after receiving credit counseling services, revealed that consumer credit usage and payment behavior were impacted in a positive way from such counseling. The analysis of 14,000 consumers examined ten different measures of borrower behavior subsequent to counseling and found that borrowers who received this form of budget/financial counseling reduced
their debt and improved their credit profile over three subsequent years, compared to similar borrowers who did not receive counseling.
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(3/25/02)
VISA & Taxes
The largest card payment network in the USA will now accept tax payments on credit cards. Official Payments Corporation announced last week that it has received authorization from VISA USA to accept VISA cards for payment of federal and state income taxes. The firm currently takes MasterCard, American Express, and Discover cards. VISA has largely been a holdout in the tax payments via credit card market.
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(3/22/02)
Discover 2GO
Discover Card's history of innovation carries forward this week with the launch a revolutionary new credit card that brings the credit card out of the wallet and onto a key chain. The Discover 2GO Card is shaped differently and smaller than a traditional credit card but has a mag stripe containing the same account information as the cardholder's existing Discover Card.
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(3/21/02)
Fee Frenzy
After credit card interest rates declined to their lowest levels last year, a fee frenzy is beginning to envelop the credit card industry this year. Chase is set to raise its late payment fee to $35 and its credit card APRs to 19.99%.
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(3/20/02)
Dumpster Diving
Digging in the trash for credit card receipts, personal checks, or bank statements to commit fraud has spread across the Atlantic. The British are now dealing with a major problem they call "Bin Raiding", the same naughty practice that Yanks call "Dumpster Diving."
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(3/19/02)
Smart IDs
Americans are beginning to come to grips with the fact that it is impossible to achieve both complete security and complete privacy. Never the less, when it comes handling personal identity information, many U.S. consumers trust credit card companies more than the government.
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(3/18/02)
BJ's MasterCard
After 18 months of searching for a new partner, the largest operator of membership warehouse clubs in the Northeast has signed a deal for a co-branded MasterCard. BJ's Wholesale Club and First USA will launch the new MasterCard in June, targeting more than six million BJ's club members.
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(3/15/02)
i-GEN Teen Card
While some teen payment cards have floundered, the i-GEN MasterCard is alive and well, and getting ready for a major expansion. This week, Pasadena, California-based Next Estate Communications signed a deal to expand marketing of the personalized, prepaid card beyond Rite Aid stores.
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(3/14/02)
Stockback MasterCard
As the Stockback MasterCard enters its third month, Chase announced this week
that more than 85 retail merchants are now involved in the program. The new
card is unique as it enables cardholders to earn cash rewards that can be
automatically invested in a mutual fund with Merrill Lynch.
-READ MORE |
(3/13/02)
Flightfund Expands
More airline credit cards are reaching out to small business as air travel
remains soft. America West Airlines and Bank of America introduced the
FlightFund VISA Business Card. American Airlines, Delta, Northwest, US Airways
and Alaska Airlines now offer business versions of their credit card programs.
-READ MORE |
(3/12/02)
Sluggish Start
True to their New Year resolutions, Americans have begun to slow down on
credit card debt. During January, consumers added a mere $1.2 billion to
revolving debt, compared to $6.9 billion one year ago. Revolving credit has
been flat since September when it stood at $692.7 billion.
-READ MORE |
(3/11/02)
Lenticular Card
A new credit card design has hit the market which appears to have moving
images. The new lenticular credit card is being issued by North Carolina-based
Lowe’s Home Improvement Warehouse. The Lowe's NASCAR credit card, shaped
like a biconvex lens, features NASCAR Winston Cup action with moving images of Lowe’s
race cars and drivers.
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(3/8/02)
Online Payments
About one third of cardholders who surf the Internet have paid their credit card bill online. This week, Discover launched a sweepstakes to encourage more
cardholders to click and pay their account online. Until May 31, cardholders who register and pay their Discover Card bills online using the SmartCheck payment option will automatically be entered in the sweepstakes.
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(3/7/02)
Minimum Payments
Among the 60% of American cardholders who do not pay off their credit card
balance each month, nearly half made just the minimum payment due last month.
This means that about one out of four cardholders in the USA now make minimum
payments.
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(3/6/02)
Net 1st Dies
The worst credit card in America is dead . . . for now. The Net 1st
MasterCard, issued to new "credit-challenged" cardholders with a $500 balance
and a $500 credit limit, bit the dust as banking regulators shut down the
issuer, Florida-based Net First National Bank. The Office of the
Comptroller of
the Currency closed the bank last Friday primarily because of bad SBA business
loans.
-READ MORE |
(3/5/02)
On Target
Target's new smart VISA card has gone from zip to 2.5 million cardholders in
less than five months, becoming the third largest issuer of smart credit cards
in the USA, just behind American Express and Providian. Since the launch of
the VISA program in September, Target has generated $1.5 billion in VISA card
loans, and they expect to top $4.5 billion by the end of this year.
-READ MORE |
(3/4/02)
Fee Climb
Average late payment fees on credit cards will climb by 3% this month, the
largest one month jump in the industry’s history, as more issuers raise fees
above the $29 level. U.S Bank recently joined the trend in the wake of fee
increases by MBNA and Discover, which went into effect this month. U.S.
Bank is now charging a $27 or $35 late fee, depending on the number of delinquencies
occurring within twelve consecutive billing cycles.
-READ MORE |
(3/1/02)
Rate Range
Interest rates on bank credit cards have widened as a result of the eleven
rate cuts by the Feds last year. Card rates, after the introductory periods,
now range from 4.75% to 35.00%, the widest spread ever. Chase offers the
lowest rate on its 'Prime Card' at 4.75%, while CompuCredit charges a 35% rate for
its 'Aspire VISA' card.
-READ MORE |
