Visa Introduces Digital Card Replacement Service: How It Will Help Travelers
The goal is to help travelers enjoy hassle-free trips by alleviating the stress of losing a credit card while away from home. With this service, cardholders can get near instant relief if they lose their Visa credit card. Once a card is reported lost, a digital replacement will be sent via text or email. This new card can then be authenticated and added to a digital wallet in minutes. According to the Visa Global Travel Intentions Study (2023), 74% of U.S. travelers now use digital wallets on their trips. [Forbes]
Federal Judge Rejects Visa, Mastercard Swipe Fee Settlement
A U.S. district judge denied a $30 billion antitrust settlement between credit card giants Visa and Mastercard and a group of retailers that would have rolled back so-called swipe fees the card companies charge for a limited time. Most retail groups, though, criticized the proposed agreement for not going far enough to relieve them against Visa and Mastercard, which controls roughly 80% of the credit card market. The preliminary agreement would have required the credit card companies to roll back their swipe fees, the percentage they charge merchants each time a customer uses the card, by at least 4 basis points for at least three years and cap fees at 2023 levels for the next five years. Opponents of the agreement said the deal was too temporary for retailers to make a real difference. [UPI]
Amex Banks on Spending at High-End Restaurants
When American Express announced its purchase of Tock earlier this month, it signaled that it is doubling down on delivering premium experiences to its clients, analysts said. Tock works with high-end restaurants, and the $400 million acquisition is neatly aligned with Amex’s penchant for dangling luxury experiences in front of its card holders. Amex said last week that it plans to buy Tock from Squarespace, which bought the reservation platform in 2021 for around $400 million. The credit card company also said it plans to buy the Washington D.C.-based payments platform Rooam for an undisclosed sum. Rooam offers point of sale software to restaurants. [Payments Dive]
China Said to Ask Visa, Mastercard to Cut Transaction Fees
China is pushing for Visa and Mastercard to lower their bank card transaction fees in the country, a person familiar with the matter said, as part of an effort to facilitate payments for foreign visitors. The Payment & Clearing Association of China is negotiating with global card issuers including Visa and Mastercard on lowering fees local merchants are charged on foreign card transactions. The association proposed trimming the fee to 1.5% from 2-3%, the person said. [Bloomberg News]
Mastercard to Phase Out Manual Card Entry for Online Payments in Europe by 2030
Starting from 2030, Mastercard will no longer require Europeans to enter their card numbers manually when checking out online, no matter what platform or device they’re using. Instead of the 16-digit card number we’re all accustomed to using for transactions, this will be replaced with a randomly generated “token.” Consumers will be able to make one-click payments at the checkout page using biometric authentication with a thumbprint. [CNBC]
Small Businesses Racking Up Credit Card Debt to Combat Inflation Pressures
Small business credit card debt is on the rise. And it’s likely due, at least in part, to inflation. According to data from Bank of America Institute, small business credit card balances are up 18% since 2019. Small businesses reach for credit cards for many reasons. But in 2024, the main factor putting financial pressure on businesses seems to be inflation. In fact, a recent survey by Goldman Sachs found that 71% of small business owners feel that inflationary pressures have increased on their businesses over the past three months. Turning to credit cards is just one of the adjustments that small businesses are making. In addition, 47% said they are raising prices, 45% are working more hours, and 32% are reducing their own salary. [Small Business Trends]
Why Walmart Broke Up with Capital One and the Dark Horse Bank Set to Benefit
When Walmart made a push into credit cards in 2018, it turned to one of the largest banks in America, Capitol One. The two giants signed an exclusive long-term deal that promised to help Walmart offer its clients the latest in digital credit card products, while Capital One was basically given the keys to Walmart’s kingdom: access to a retail market larger than some nations’ GDPs without any of that pesky competition. It didn’t work out. Things started to fall apart in 2023 when Capital One violated terms in its contract that dictated certain customer service requirements, including how long it would take to post charges to a minimum percentage of cards. Last month, Walmart ended the exclusive deal with Capital One, citing in court documents multiple issues with the bank’s customer service, but not before Capital One accumulated $8.5 billion worth of credit card balances, which it will retain. [Yahoo Finance]
Fitbit Users Can Finally Add American Express Cards to Google Wallet
Fitbit users have not been able to add American Express cards for payments ever since Google switched from Fitbit Pay to Google Wallet. Although support for American Express cards appeared in a Google Play Services update changelog earlier this year, Google removed the entry a few days later and clarified that the update would not enable the feature. Google has, once again, added the feature to the latest Google Play Services update, and it is finally reaching users with the new release. [Android Authority]
Consumers Say They Use Credit to Buy Essentials and Spend More
A new PYMNTS study found, generally speaking, there are three types of credit users. When “necessary financers” use credit, more than half the time it’s out of necessity. The second group, “middle financers,” are those for whom only about half of their credit purchases are driven by necessity. When “choice financers,” use credit, less than half the time it’s out of necessity. Economic pressures often drive these behaviors. For example, necessary financers tend to use cash and debit cards first to keep essential purchases from adding to their credit card debt. They use credit sparingly, reflecting a cautious approach to financial management. In contrast, PYMNTS Intelligence data shows that choice financers spend more and accumulate credit card benefits, such as reward points, along the way. Additionally, this group is more likely to avoid interest charges by paying off monthly balances whenever possible. [PYMNTS]
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