Consumer Payment Card News

Coronavirus Claims, Love Scams & Blue Sneakers

Coronavirus Claims

Coronavirus claims for travel disruption takes off, as thousands of Americans fall victim to love fraud, beating robocallers at their game, and the economy looks good for now, but wit till the debt collectors start calling in 2021 and beyond.

Travel insurance typically costs between 5% and 10% of the total cost of a trip, but can vary based on your age, the amount of coverage requested, details of the trip itself and the number of people traveling. The gold-standard travel insurance policy will offer the option to “cancel for any reason” or “cancel anytime.” This insurance could kick in, for example, if you’re afraid to travel to a location because of the coronavirus. Such policies can cost as much as 50% more than a standard travel insurance policy, according to CardBuzz.

Romance scammers prey on consumers who are looking for love, converting what feels like a budding relationship into an ask for money to help the scammer get out of some manufactured crisis. The stories and feelings can be compelling, and the losses can be huge. Last year, more than 25,000 consumers filed a report with the FTC about romance scams, and over the past two years total reported losses to romance scams were higher than to any other scam reported to the FTC, according to Bankcenter.

Debit & Prepaid Cards

Visa and Mastercard payment cards (credit, charge, debit, and prepaid) cin the U.S., for the fourth-quarter posted an increase of 5.2% year-on-year, compared to a 5.8% YOY gain for the prior quarter. Visa and Mastercard U.S. credit cards increased 3.7% YOY, while debit cards rose 6.2% annually at end of 2019. There were 1420 million Visa and Mastercard payment cards in circulation in the U.S. at the end of 2019, compared to a revised 1350 million for for 2018. Since 2015, Visa and Mastercard have added 228 million payment cards in the U.S, according to CardData.

Custom Blue Sneakers

In celebration of NBA All-Star 2020, American Express teamed up with Chicago designer, Don C, to launch the limited-edition “Nike Air Force 1 Hi Just Don,” are now available online exclusively for American Express Card Members. The “Amex Blue” custom sneaker is inspired by Don’s Chicago roots – with the colors also resembling the blue and red of the Windy City’s flag. 

Kicking the Trade

The trade-in, where a buyer hands a car back to a dealership and uses it as credit toward another one, is often a crucial step in car buying. But some dealerships are instead telling buyers to give their old cars back to their lenders—and selling them new ones—in a practice known as “kicking the trade.” TransUnion calculates that nearly 24 million U.S. vehicle loans were originated in 2018. About 300,000 of those vehicles were repossessed within 12 months, up 17% from 2014. Such a quick souring of the loan can be a signal of some sort of auto fraud, according to CardWeb.

Credit Card Late Payments

Credit card delinquency is projected to rise sharply in the next five years. The outcome of the 2020 U.S. election cycle will have a unprecedented and profound impact on the U.S. economy, the global economy, and the payment card industry through 2025. Solid projections point to early stage credit card delinquency among the nation’s top issuers to exceed 3.00% before 2022, according to RAM Research.

Robert McKinley, Senior Analyst says with an unsustainable U.S. budget on the table and declining tax revenue, a GOP-led government could trigger another prolonged recession. A DEM-led government may delay or shorten a recession by unraveling the past four years of politically expedient economic decisions. However, dealing with U.S. healthcare issues will still leave the biggest threat, an unsustainable budget, on the table.

Robocaller Revenge

DoNotPay, the family of consumer advocacy services meant to protect people from corporate exploitation, is launching a new app aimed at helping end our long national nightmare surrounding robocalls by giving you a burner credit card to get their contact details then giving you a chatbot lawyer to automatically sue them. The recently passed TRACED Act also grants the FCC new powers to pursue and punish illegal robocalls. Now, federal fines can reach as high as $10,000 per call and requires major carriers to adopt new technology that will alert consumers to incoming robocalls.

Virus Scan Scam

The Federal Trade Commission is sending refund checks totaling more than $34 million to consumers who allegedly were tricked by Office Depot, Inc. and a software provider into buying computer repair products and services. Office Depot paid $25 million while its software supplier, Support.com, Inc., paid $10 million as part of 2019 settlements with the FTC. The FTC alleged that Office Depot and Support.com configured a virus scanning program to report that it found symptoms of malware or infections—even when that was not true—whenever consumers answered yes to at least one of four “diagnostic” questions. The false scan results were then used to persuade consumers to purchase computer repair and technical services that could cost hundreds of dollars.

Credit Card Profits

Card yield, as an average for the nation’s Top 4 credit card issuers, reversed course in the final three months of the year, after posting new records throughout 2019 All of the issuers, except Chase, posted significantly lower yields in the fourth-quarter from the prior quarter. However, this is fifth consecutive quarter wherein all of the Top 4 exceeded 10%. The U.S. Top 4 Issuers (Chase, Capital One, Bank of America Citibank credit card yield dipped 28 basis points (bps) sequentially at 12.02% and down 8 bps year-on-year (YOY) for the fourth-quarter (4Q/19), compared to 12.30% for the prior quarter, and 12.10% for 4Q/18, according to CardFlash and PYRPTS.

Professor Cardworthy recently added a two new episodes his YouTube Channel. The episodes: How to Replenish Your Stash and My Credit Score Sucks – Maybe 500.

Sources: CardData; RAM Research; CardTrak; CardFlash; Cardworthy; CardWeb; PYRPTS; CardBuzz; Bankcenter; PYVNTS; Ruebud Media; Red3 Media; Robear’s List