Biometrics are expected to play a much larger role in payments.
Will biometrics be the future of payments?
Tech companies Apple and Google, major influencers of consumer behavior, have done the heavy lifting when it comes to biometric acceptance. Their technological tools and ubiquitous smartphones have encouraged consumers to use their fingerprints or face to gain access to their devices. Additionally, user IDs, PINs and passwords have become a headache for many. Consumers who have grown tired of the need for unique passwords may increasingly see biometrics as a welcome change. As the pandemic has driven a transition to contactless, payment players want to make transactions as smooth and fast as possible, both to increase volumes and to please customers. Harnessing biometrics goes one step further, proponents say, with ease of use and security, two necessities in the digital age. [Payments Dive]
Organized Credit Card Fraud Groups Create Fake Sites to Charge Stolen Credit Cards
As is the case with ransomware and other forms of cybercrime, the credit card fraud landscape tends to evolve and follow “industry trends” over time. A new report from threat intelligence firm ReasonLabs reveals that since 2019, at least one major gang in this space has focused on creating fake dating and customer support websites and using them to deceive legitimate payment processors to grant them access to their services. Once scammers have the ability to charge credit cards, they purchase stolen cards from the dark web and charge them. The fact that these dating sites are known to have high chargeback rates also works in the attacker’s favor by providing an explanation for what would otherwise be considered unusual business activity. The attacker is also likely targeting more fringe payment processors that have a lower acceptance bar for “high risk” businesses. [CPO Magazine]
Trade in your old devices for Amazon gift cards. here’s how
Older technology is becoming less flashy by the day and will eventually find its way into that drawer full of other retired, dust-gathering, forgotten gadgets. Unless you return the device(s) through a take-back program. Amazon’s Trade-In Program is a quick and easy service that converts unwanted tech into Amazon gift cards and/or discounts. It’s also a satisfying way to recycle old electronics for free. Here is a step by step overview of the service. You’ll be surprised how many products, from Amazon and not, qualify for a decent trade-in offer. [ZD Net]
Square officially launches support for Tap to Pay on iPhone
Square has publicly launched support for Tap to Pay on iPhone to sellers across the United States, allowing small merchants and independent retailers to use their iPhone as a payment terminal. Tap to Pay on iPhone allows sellers to accept contactless payments directly using an iPhone, with no additional hardware or dongle required. The public launch follows Square’s early access program for Tap to Pay on iPhone that began in June. [MacRumors]
Credit card competition law can make banking more expensive and less secure
Look at past efforts to reduce interchange fees. More than a decade ago, Congress capped these fees for debit cards. Price controls have reduced the cost of accepting debit cards for merchants. But only 1.2% of traders used savings to drive down prices, according to research by the Federal Reserve Bank of Richmond. The rest kept prices the same or raised them, keeping the savings for themselves. Reducing the amount of money that backs the trading system could have serious consequences for consumers. The biggest concern is fraud. Interchange fees help offset the growing losses associated with fraud as well as expenses related to fraud detection systems. [The Dallas Morning News]
JPMorgan bolsters restaurant push with new DoorDash credit card
JPMorgan Chase
JPM
46% of college students with credit cards have debt
More than 67% of undergraduates have a credit card in their name and just over 9% have access to a credit card as an authorized user, according to a mid-September survey by US News. Having a college credit card is a great way to build your credit history, but only if you use the cards responsibly. Unfortunately, nearly half of survey respondents say they have credit card debt. Of the 46.1% of respondents who have credit card debt, 27% say their credit card debt exceeds $2,000. [U.S. News & World Report]
Goldman Sachs: three major cobrand credit cards and almost half of American households
Making the jump from investment banking to the tough world of consumer banking isn’t easy, but Goldman Sachs does it with co-branded credit cards. First, there was Apple, which brought an addressable market of 113 million iPhone users to the United States. Then came the GM card, an iconic brand representing a base of 2.2 million car sales in the United States (and 61 million total General Motor vehicles on the road). ). Now comes T-Mobile, with 22 years in the US market and 109 million customers. What a way to start a credit card company. Pre-screened potential customers in three vertical markets. No branches to manage, just good names to collect and solicit. [Payments Journal]
CFPB fines regions $191 million for overdraft practices
Regions Bank will pay $191 million to settle allegations by the Consumer Financial Protection Bureau that the bank charged customers “illegal surprise” overdraft fees on certain ATM withdrawals and debit card purchases between August 2018 and 2021. The penalty includes a $50 million fine and $141 million the CFPB orders the lender to pay customers hit with “allowed positive” charges. The bank said it eliminated the allowed positive charges more than a year ago when it rearranged the order in which transactions were recorded. [Banking Dive]
Mastercard, Hi App Partner to issue cards with NFT avatars
In partnership with Mastercard, crypto and fiat financial app hi is launching what it calls “the world’s first debit card with NFT avatar personalization.” Eligible owners of top-notch NFTs can now personalize Mastercard debit cards with avatars they verifiably own. This means they will be able to have their beloved character inscribed on the plastic card in their pocket. For starters, hi cards will initially be available in over 25 EEA countries plus the UK. [Finance Feeds]
Understanding the Risks of Buy Now, Pay Later Apps
A whopping 43% of Americans said they had used a BNPL service, according to an April 2022 LendingTree poll, up from 31% in 2021. These services are also most popular among women, Gen Z (18-25), and those making between $50,000 and $74,999 per year. Students and recent graduates, who make up Generation Z, tend to have little or no credit history and generally have less financial knowledge. If mismanaged or overused, BNPL services can have dramatic consequences on the already delicate financial well-being of a young consumer. Without understanding the hidden risks of BNPL loans, these services can cause more harm than good to consumers. Here’s what you need to know before you consider using BNPL apps. [CNBC]
Samsung launches credit card in India
Samsung has launched two credit cards in India, entering a crowded category that sees more than 50 companies fiercely vying for consumer attention in the world’s second-largest internet market. The South Korean giant said it has teamed up with Mumbai-headquartered Axis Bank and global payment processor Visa to launch the cards, which it calls the Samsung Axis Bank Credit Card. Consumers who purchase Samsung products and services through either card will receive 10% cash back. [Tech Crunch]