Visa, Mastercard Pause Crypto Push; Tracking Gun Purchases

Visa, Mastercard Pause Crypto Push in Wake of Industry Meltdown

U.S. payment giants Visa and Mastercard are slamming the brakes on plans to forge new partnerships with crypto firms after a string of high-profile collapses shook faith in the industry, people familiar with the matter told Reuters. The crypto industry saw a stunning reversal of fortunes in 2022 as bankruptcies of industry majors FTX and BlockFi rattled investors and increased regulatory scrutiny on the sector. Both Visa and Mastercard have decided to push back the launch of certain products and services related to crypto until market conditions and the regulatory environment improve. [Reuters]

Discover to Enable Tracking of Purchases at Gun Retailers from April

Discover, a provider of credit cards, told Reuters it will allow its network to track purchases at gun retailers come April, making it the first among its peers to publicly give a date for moving ahead with the initiative, which is aimed at helping authorities probe gun-related crimes. Discover’s announcement came after the International Organization for Standardization, which decides on the classification of merchant categories used by payment cards, approved in September the launch of a dedicated code for gun retailers. [Reuters]

Nearly Half of Millennials, Gen Xers Have More Credit Card Debt than Savings

Nearly half of Americans in their prime working years, ages 27 to 58, now have credit card debts that exceed the balance in their savings accounts. Roughly 45% of millennials and Generation X consumers surveyed reported credit card balances greater than their savings or emergency funds, according to an annual emergency savings report released this week by Bankrate. [The Hill]

DoorDash Launches its First Co-Branded Credit Card with Chase

DoorDash is launching its first-ever credit card with Chase. The DoorDash Rewards Mastercard cardmembers will get 4% cash back on DoorDash and Caviar orders from merchants on the DoorDash platform, 3% cash back on dining when purchased directly from a restaurant either online or in-store, 2% cash back on grocery stores either online or in-store and 1% cash back on all other purchases. New cardmembers will get a free year of DashPass, the platform’s $9.99 per month subscription service that offers free delivery and other perks. Cardmembers can extend their complimentary DashPass membership every anniversary year when they spend $10,000. Cardmembers will also get a $100 cash bonus after spending $500 on purchases in the first three months from account opening. [Tech Crunch]

Russian Banks Say Debit Cards Might Stop Working Due to Western Sanctions

Russian banks are warning debit card holders that new sanctions from the US and UK could mean their cards stop working abroad. Emails from multiple Russian banks urging their customers to withdraw money from accounts linked to UnionPay-branded cards as soon as possible came one day after the US and UK implemented sweeping new sanctions authorizing the rejection of transactions from a list of Russian financial institutions. UnionPay is a Chinese payment system that some Russian banks were using before the war, and more turned to it after MasterCard and Visa pulled out of the country following the invasion a year ago. The sanctions are set to fully kick in by May 25, according to the US Treasury Department. [New York Post]

Chip Shortage Triggering Delays in Credit Card Deliveries

If you lost your credit card, had it stolen or are waiting for one tethered to a new account, it might take more time for your replacement credit or debit card to reach your mailbox. New cards typically take a week to send out, but a chip shortage has pushed that to eight weeks in some cases. More cards include chips, and industries like auto and tech, are competing for the tight supply. Credit cards are further down the list to get the chips, and smaller credit card issuers are even further down the list. Last summer, a global industry group for cards and mobile payments warned of a continued impact throughout 2023. [News 4 Jax]

Where Digital Payments, Even for a 10-Cent Chai, Are Colossal in Scale

The little QR code is ubiquitous across India’s vastness. The scan-and-pay system is one pillar of what the country’s prime minister, Narendra Modi, has championed as “digital public infrastructure,” with a foundation laid by the government. It has made daily life more convenient, expanded banking services like credit and savings to millions more Indians, and extended the reach of government programs and tax collection. With this network, India has shown on a previously unseen scale how rapid technological innovation can have a leapfrog effect for developing nations, spurring economic growth even as physical infrastructure lags. It is a public-private model that India wants to export as it fashions itself as an incubator of ideas that can lift up the world’s poorer nations. [The New York Times]

CFPB Publishes New Findings on Financial Profiles of Buy Now, Pay Later Borrowers

The Consumer Financial Protection Bureau has published a new report analyzing the financial profiles of Buy Now, Pay Later borrowers. While many Buy Now, Pay Later borrowers use the product without noticeable indications of financial stress, the report finds that Buy Now, Pay Later borrowers are more likely to be active users of other types of credit products like credit cards, personal loans, and student loans. They are also more likely to exhibit measures of financial distress than non-users. For example, Buy Now, Pay Later borrowers are more likely to be highly indebted or have revolving balances or delinquencies on their credit cards compared to consumers who do not use Buy Now, Pay Later products. Buy Now, Pay Later borrowers are also more likely to use high-interest financial services such as payday loans, pawn loans, and bank account overdrafts. [CFPB]

Skimming Fraud Exploded in 2022

U.S. card skimming grew by nearly 500% in 2022 and is showing signs it will grow even faster this year, according to a recent analysis by FICO. The firm’s data identified more than 161,000 compromised cards last year, or roughly five times the number reported in 2021. Nearly 3,000 unique financial institutions were affected by a compromise, representing a 79% year-over-year increase in affected institutions. The data from January 2023 was trending at a nearly 1,000% increase over 2022. Most skimming fraud was concentrated in California, which accounted for 47% of all cases tracked by FICO over the year. [ABA Banking Journal]

LendingTree Launches Credit Card with Installment Payment Model

LendingTree, which operates a financial services marketplace for consumer loans, is branching out by offering a branded credit card that is repaid at a fixed rate, like an installment loan. The LendingTree Win Visa card relies on San Francisco-based Upgrade’s model providing users with a fixed rate on purchases that are paid off in equal installments over 24, 36 or 60 months, structured like a personal loan. The card is issued by Sutton Bank, with banking services and credit lines provided by Cross River Bank. LendingTree will offer the credit card separately from the mortgage, auto and other consumer loans displayed on its online loan marketplace. [American Banker]

The History of Women and Credit Cards

In March, the United States recognizes Women’s History Month, a time to commemorate the contributions and achievements of women across different fields and eras in history. In personal finance, pioneers, legislation and particular events have been pivotal in making strides toward leveling the financial playing field for women today. And although credit cards are a modern product, they can represent a lot of the changes that women have experienced over the past few decades, from financial access to credit use. Here’s a look at the history of women and credit, some key moments in changing the status quo and where we are now. [Yahoo Finance]

U.S. Bancorp Signals CFPB Has Turned Up Heat in Prepaid Cards Probe

The Consumer Financial Protection Bureau is weighing an enforcement action against U.S. Bancorp after launching an investigation of its management of prepaid cards for unemployment benefits, according to a securities filing by the company. The Minneapolis company, which disclosed the CFPB’s investigation late last year, said in a filing Monday that the agency is now “considering a potential enforcement action” and that U.S. Bancorp is cooperating fully with all pending examinations. The CFPB probe centers on unemployment benefits disbursed during the pandemic. [American Banker]