Using a Credit Card? At These Restaurants It’ll Cost You.
Restaurants are known to have very small profit margins, about 3% to 5%. Inflation has made it difficult for restaurants to manage their costs, and they can risk losing customers if they raise prices, Mr. Kennedy said. The association has found that credit card fees are the third-highest expense for restaurants, behind food and labor costs. Owners have also lost the ability to negotiate their rates with credit card companies, he said, because Visa and Mastercard control about 80% of the market, and fees continue to increase. [The New York Times]
Amazon Expands Flex Payment Options for Amazon Pay
Amazon is giving a wider range of credit card holders access to use flex payments with Amazon Pay. The e-tail giant announced that Prime Visa and Amazon Visa cardmembers can now pay with equal monthly payment options when using the Amazon Pay solution during checkout at tens of thousands of participating online retail sites, including Lenovo, Tennis Express and Authentic Watches. This is the first time these can use equal monthly payments beyond Amazon.com and the Amazon mobile app. Cardmembers can pay 0% annual percentage rate on six- and 12-month equal monthly payment plans on purchases of $50 or more. For retailers, no additional fee or integration is required in order to offer this payment option to consumers. [Chain Store Age]
Americans’ Credit Card Debt Tops $1 Trillion, Hitting All Income Levels
Barbie isn’t the only plastic that’s hot this summer. Credit card balances shot up by $45 billion between the first and second quarters of 2023, a 4.6% increase that pushed total credit card debt past the $1 trillion mark, according to the Federal Reserve Bank of New York. While the debt has grown nationwide, the rate of credit card delinquencies also has been rising and topped 5% in July, the Fed said. Analysts expect the number to keep rising. A Bank of America Institute report analyzing consumers in three income categories found high-income earners, households that bring in more than $125,000 per year, have often managed to curb their monthly credit card spending more than lower-income earners. [Forbes]
The Parent Debt Trap: Parents’ Credit Card Balances 26% Higher Than Average
That having children is costly may not be surprising, but the extent to which parents with children depend on credit cards is. While parents with children at home are only slightly more likely than the average consumer to carry credit card balances, these parents tend to carry significantly higher balances. The credit card balances of consumers with children are as much as 26% higher than that carried by the average consumer. [PYMNTS]
Cash-Poor Americans Are Paying $25 Billion in Hidden ‘Junk Fees’ Each Year
Designed for those with lower income and poor credit ratings, the research showed that subprime credit cards account for $11.5 billion in additional fees each year. These fees encompass the Annual Percentage Rate, plus subscription fees, late fees, fast payment processing fees, application fees, monthly maintenance fees, new card fees, and ATM fees. Following subprime credit cards, payday loans ranked in the study as the second most costly option-roughly $6 billion in additional fees annually. Fintech solutions like earned wage access and peer-to-peer lending amounted to $1.3 billion in annual fees. [Fortune]
CFPB’s Chopra Teases New Rules for Data Brokers at White House Roundtable
CFPB Director Rohit Chopra, in remarks delivered Tuesday to a roundtable of the White House National Economic Council and Office of Science and Technology Policy, said the potential rules are being developed as “part of an all-of-government effort to tackle the risks associated with AI (artificial intelligence).” The rulemaking is intended to “ensure that modern-day digital data brokers are not misusing or abusing our sensitive data,” he said. Chopra said the CFPB will consider defining data brokers that sell certain types of information as consumer reporting agencies. The data under consideration includes a consumer’s payment history, income, and criminal records. Classifying data brokers as consumer reporting agencies would “trigger requirements for ensuring accuracy and handling disputes of inaccurate information, as well as prohibit misuse,” he said. [Compliance Week]
Capital One Clarifies Application Restrictions, Adds 48-Nonth Rule for Personal Cards
Previously, a number of Capital One personal cards had the following language, “The bonus may not be available for existing or previous accountholders.” The vagueness around whether you could be approved for a new Capital One personal card has been clarified. Now you won’t get the card if you have received a bonus on that same card in the past four years. The updated language simply provides clarity and aligns Capital One’s policy with Chase’s 48-month rule for the Chase Sapphire Reserve and the Chase Sapphire Preferred Card, as well as Citi’s 48-month rule on most of its ThankYou points-earning and cobranded cards. [The Points Guy]
Ouch: Amex is Making Some Ugly Changes to the Platinum Card
American Express is making some substantial changes to The Platinum Card from American Express, making it harder to earn a big welcome bonus and more expensive to share perks like lounge access or instant hotel status with loved ones. The bank quietly tweaked the terms and conditions for its flagship travel card overnight. For years, new Platinum cardholders have earned a welcome bonus, be it 80,000 points or a whopping 150,000-point bonus, after spending $6,000 within the first six months. It’ll now require spending $8,000 within that span. Adding authorized users to your Platinum Card is getting drastically more expensive. Instead of adding up to three users for a total of $175, they’ll now cost $195 each. [Thrify Traveler]
Credit Sesame Launches Credit-Building Debit Card
Credit Sesame has unveiled a new product that aims to help individuals build and enhance their credit scores through their everyday debit purchases. The new Sesame Credit Builder is a Mastercard debit card designed to eliminate obstacles for those with limited credit history and equip them with the tools to establish a positive payment history. Unlike traditional secured credit cards, Sesame Credit Builder does not necessitate a credit check, an initial security deposit or any interest charges. Users can simply make purchases or pay bills with their debit card and earn the credit that makes it easier for individuals, particularly those with low or limited credit history, to develop a stronger credit history. [PYMNTS]
A Possible Workaround to Having to Give Your Sensitive Bank Account Info for Autopay
I set up a sub-account within my checking account, almost like you would do with a linked savings account or your child’s checking account. My sub account has its own account number and its own routing number. I gave those to the company that required a bank account for an auto-pay discount. Then, in that account, I deposited a little bit more than the amount of the monthly bill that I am trying to pay. And each month I transfer the money to cover that bill from my main bank account to the sub account. It is annoying, but it takes a minute per month but I do not have to give someone else the information to my primary bank account. [WFAA]
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