Consumers Overspent During Holidays; Who Really Owns Crypto?

1 in 3 Americans overspent while on vacation, increasing credit card balances

Christmas sales are on track to grow up to 11.5% during 2020, according to a projection from the National Retail Federation. About 30% of Americans said they overspent during gifting season, according to a post-holiday survey from WalletHub. Although omicron generated a new wave of infections, 56% said that Covid did not affect their plans. For most buyers, increasing their expenses also meant relying more on credit cards or buying now, paying financing later to spread their expenses. As a result, about 36% of consumers went into debt, owing an average of $ 1,249, according to a LendingTree survey. [CNBC]

The use of cryptocurrencies is increasing, most will use it for mobile purchases

More than a third of consumers ages 18 to 54 own cryptocurrencies, according to a recent Cantaloupe study, with people ages 18 to 34 more likely to own them (37%) and people ages 35 to 54 (33 %) stay only slightly. Additionally, 67% of those who own crypto are willing to consider using it for purchases if it were linked to a mobile wallet, and an additional 19% say they would consider using crypto linked to a mobile wallet if it were easy. [Vending Times]

User experience reigns supreme in credit card decisions

A super low interest rate may seem like the most tempting benefit to potential credit card holders, but research shows that there are a host of other factors that consumers take into consideration when deciding whether to use one card over another. According to new research, 75% of consumers consider user experience benefits such as cash back rewards, data privacy, and credit building tools. The research indicated that 70% of those looking for a card consider data security to be the top priority, and 75% of active users who are also parents look for credit building tools when considering a card. [PYMNTS]

Data on the use of US credit card lines.

US credit card lines, the amount issued by issuers for each open account, is at an all-time high. In the latest figures released by the Federal Reserve, total credit lines amount to $ 3.9 trillion. However, only 27% of these lines of credit are in use and $ 3 trillion is available in open credit. Note that line utilization is down, based on a utilization rate of 20.3%. In contrast, the utilization rate in 2009 was 27.7% after credit card issuers began contracting lines of credit during the Great Recession. [Payments Journal]

JPMorgan Chase has unleashed a lightning attack on credit card customers

After a hiatus of nearly a decade, Chase has resumed demand from indebted clients. The bank has returned to its old ways, consumer attorneys say. Since the beginning of 2020 and to this day, Chase has filed thousands of lawsuits against credit card customers who have fallen behind on their payments. Chase had stopped filing credit card lawsuits in 2011, in the wake of the last major economic downturn, after regulators discovered that the company was filing tens of thousands of flimsy lawsuits, sometimes overstating what customers owed. Today, just as it did before coming into conflict with the CFPB, Chase is producing affidavits en masse from the same San Antonio office where low-level employees generated hundreds of thousands of affidavits in the past, according to defense attorneys and court documents. [ProPublica]

Banking technology trends to follow in 2022

This year’s banking technology initiatives will be driven by the need to make finance ultra-convenient for consumers and businesses. One manifestation of this is integrated banking, a version of the open banking movement started in Europe, where banks offer their services through all kinds of non-bank companies. Another is the effort banks are making in personalization, trying to provide just-in-time advice to consumers to help them avoid financial trouble and seize opportunities. And allowing customers to empower themselves with a selfie and facial recognition is the best way to provide security for TV addicts. Banks and fintechs will also continue to try to become a trusted place for consumers and businesses to search for cryptocurrency services as the popularity of digital assets continues to grow. [American Banker]

The explosive growth of mobile payments for cross-border transactions

The amount of money that crosses the world each year is staggering, and $ 156 trillion is expected to cross international borders annually by 2022. These payments include everything from multi-million dollar corporate acquisitions to small-value remittances sent by migrant workers, but one of the fastest growing. Market segments are transactions of individual consumers of goods and services. One of the main contributors to this growth is the growing popularity of mobile commerce, where consumers use their smartphones to purchase items ranging from toilet paper to computers to cars. Mobile commerce is expected to grow 70% in the next five years. [PYMNTS]

Washington advises industry to “buy now, pay later”

The buy now, pay later industry, an increasingly important driver of retail sales, could face new rules as DC scrutiny unfolds. The Consumer Financial Protection Bureau is reviewing the policies of Affirm, Afterpay, Klarna, PayPal, and Zip, some of the most notable players in the BNPL industry. The CFPB is concerned that these platforms could encourage overspending and circumvent existing regulations around credit and loans. He also plans to examine data collection practices. [Axios]

Credit card startup Petal achieves an $ 800 million valuation

Petal, a credit card startup, has raised $ 140 million in a funding round led by Tarsadia Investments. The financing round values ​​the company at $ 800 million. The startup offers a solution to consumers who do not qualify for traditional credit cards or who have no credit history. Its technology measures the creditworthiness of income, expenses and savings in a process referred to as “CashScoring” and has approved nearly 300,000 credit cards to date. The company says its members with no prior credit history have achieved an average credit score of 676, which then qualifies them for other loans and mortgages that were previously unavailable. [Bloomberg]

Visa and Mastercard Hire Fintechs to Reach Latin America’s Unbanked

Visa and Mastercard are courting fintechs to help them reach more consumers in Latin America, where a significant unbanked population has turned to non-bank companies for financial services. As tech companies have managed to reach a market that banks have neglected, technology partnerships have become vital to the efforts of US card networks to expand across borders. [American Banker]

Bank of America CEO: Consumers Spend at the Fastest Rate Ever

The head of the nation’s second-largest bank said consumers are spending “at a faster rate” than ever, but remains concerned about how inflation and supply chain problems will weigh on the economy heading into winter. Bank of America President and CEO Brian Moynihan said the bank’s credit and debit card spending has skyrocketed as the economy recovered from the recession. But Moynihan also said that a recent decline in consumer confidence, down to the lowest point in a decade, may indicate that higher costs are adding to Americans’ frustration with the ongoing pandemic. [Associated Press]

The Citi Prestige has made your annual $ 250 travel credit more flexible for another year

In the wake of the coronavirus, Citi has tried to prevent its Citi Prestige cardholders from canceling by modifying their benefits. It’s a travel credit card, after all, and its $ 495 price for the primary cardholder is hard to justify if you’re not traveling. For the third year in a row, Citi is expanding the annual travel credit of up to $ 250 to include grocery and restaurant expenses. [Business Insider]

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