Consumers Continue to Cut Back
Posted on October 6th, 2010
Consumer borrowing fell for a record 23 consecutive months in July with the help of Americans who cut back on credit card use (17th drop in 18 months), as they work to pay down debt following the worst recession since the 1930s. Borrowing on credit cards fell by an annual 6.3% in July after a bigger 7.5% June decline. The only increase in credit card use this year was a small 1% rise in January. However, one small bright spot for the economy was the boost in the category that includes auto loans which rose 0.6%, after gains in July of 3.2% and May of 1.2%. The annual level for total consumer credit stands at $2.42 trillion, 6.3%
lower than the peak of $2.58 trillion set in July 2008.
While lowering overall debt is a positive move for American households, it places a drag on an economy that is struggling to rebound – 70% of total economic activity is consumer spending.
Tags: Back, Cut Back
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Recent Credit Card Complaints – October 2010
Posted on October 3rd, 2010
Credit card complaints have remained on a steady decline since the first major phase of the CARD Act was implemented in February. Nevertheless, consumers continue to encounter problems with their credit card companies, and no problem has loomed larger in 2010 than complaints about credit limit cuts.
Between the fall of 2008 and February of 2010, the majority of credit card complaints received and analyzed by Smart Balance Transfers focused on interest rate increases. The major banks, knowing they would no longer be able to impose any time, any reason rate hikes on consumers, began a massive interest rate increase spree that seemed to spare very few. The end result of this left a substantial portion of the credit card wielding population with interest rates as high as 29.99%.
Now, stripped of the ability to raise rates on existing balances, credit card companies are resorting to credit limit cuts as a key risk management tool.
Tags: Card Complaints, Complaints, Credit Card, Credit Card Complaints
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A Stolen Credit Card You Didn’t Even Know You Had
Posted on October 2nd, 2010
We all know what a pain in the keister it is to deal with a stolen credit card, or at least we can guess. If you’ve never experienced it yourself, you probably know someone who has. Yours truly once had a whole wallet full of cards stolen, and I can assure you, it’s no picnic.
But that’s not the worst thing that can happen with a credit card theft. Someone might go hog-wild with a credit card you even never knew you had.
Now wait a minute here!
Everybody knows you’re supposed to keep a close eye on your credit card statements. This simple step saved the bacon for a friend of mine, who used to work as an archaeologist for a company in New Orleans.
One day, the CFO called him in and asked, “Why did you spend $500 on your company MasterCard at this gas station across town?” And my friend, confused, said, “I don’t have a company MasterCard.
Tags: Credit Card, Know, Stolen Credit, Stolen Credit Card
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Credit card transactions ‘create a data shadow’
Posted on October 1st, 2010
The rapid development of digital technology has meant that every “cashless transaction” is now recorded in databases for use by banks and advertisers, it has been observed.
Tech writer Mark Pesce suggested that every time a consumer spends on their credit card, it adds to a “data shadow” that steadily grows and follows them around.
Writing for ABC.net.au, he noted that such data can then be exploited by banks to calculate the creditworthiness of customers, minute-by-minute, or by retailers aiming to make their advertisements more effective.
“For years we’ve been warned that with every database transaction, the place for ourselves, which allows us to exist unmolested and unconstrained, grows ever smaller,” commented Mr Pesce. “Our opportunity to move, unseen and invisible, in the digital world, has become tiny.”
Aussies looking for greater spending privacy and security may wish to compare credit cards and switch provider. Read full post…
Tags: Create Data, Data
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Credit card charge rip-off exposed
Posted on September 29th, 2010
Airlines, holiday companies and cinemas are ripping off customers by imposing a massive mark-up on card-processing fees that should cost just 10p.
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Banks typically charge businesses a few pence to process a debit card sale, however shoppers can be stung for £5 and often much more.
At the same time, firms are profiteering by inflating the ‘must pay’ processing fees on credit card purchases.
Household names such as Ryanair, easyJet, Odeon, NCP, Premier Inn, Eurostar and the Government’s DVLA are all in the dock.
Tags: Card, Card Charge
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NAB to reform credit card payments
Posted on September 28th, 2010
Credit card users in Australia could be tempted to compare the market following an announcement by a leading financial institution.
National Australia Bank (NAB) has announced that it is to reform the way payments and balance transfers are managed on its credit card accounts.
The move, which NAB said is the first of its kind by a major bank, is set to lead to lower interest payments for credit card users.
More than 1.5 million customers will benefit from the moves, which come after pressure from consumer advocacy groups and are in line with proposals made by the Federal Government during the recent election campaign.
Lisa Gray, NAB’s personal banking group executive, said: “Consumers may be unaware that typically across the finance industry their credit card repayments are used to pay off balances attracting the lowest interest rate first, leaving the higher interest balance to attract interest charges.
“This will no longer be the case for NAB customers. Read full post…
Tags: Card, Credit Card
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