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Total U.S. household debt levels increased in the first quarter as already stressed credit card borrowers faced rising challenges, a report from the Federal Reserve Bank of New York said on Tuesday.
Apple Card credit-card holders can open an account with a 4.15% annual percentage yield.
Canada's Scotiabank is converting credit card repayments into buy now, pay later plans, with the option to pay off debt in three, six or 12-month fixed instalment payments.
Step, a teenager-focused US mobile banking startup, has raised $100 million in a Series C funding round led by General Catalyst and joined by Stripe and a host of celebrities including Will Smith and Jared Leto.
Digital advertising platform Cardlytics is set to buy cash-back offers outfit Dosh for $275 million in cash and stock.
Mexican fintech Stori has raised $32.5 million in a Series B funding round to bring credit cards to the country's middles class.
Basiq, a NAB, Westpac, Salesforce and Plaid-backed open banking platform, is introdocuing a new feature for lenders to aggregate outstanding consumer loans, including buy now, pay later debt, to get more visibility into customer liabilities.
On the heels of filing for an IPO, Marqeta has added credit cards to its open API issuing and processing platform.
Ally Financial has struck a $2.65 billion deal to buy CardWorks, enabling it to enter the credit card and merchant acquiring sectors.
The card will charge no fees, pay daily cash rewards and sync with consumers’ iPhones to analyze their spending.
Mastercard continues its spending spree, agreeing to buy Ethoca, a firm that helps merchants and card issuers collaborate in real-time to identify and resolve fraud in digital commerce. Financial terms were not disclosed.
Consumer champion Which? is calling on the Government to appoint a regulator to protect access to cash, as a combination of bank branch and cashpoint closures dries up the supply of notes and coins in small communities.
Here’s something to think about the next time you are swigging down a frothy Double Mocha Macchiato at the viridian mermaid’s: your Starbucks Rewards app is one of the main reasons why the U.S. lags behind China, Sweden and many others in adopting mobile fintech and cryptopayment solutions.
Fyre Festival attendees who booked their nightmare getaway on credit rather than debit are in a much better position to get a refund.
The European Central Bank is floating the idea of using instant payment rails to link up national card schemes as a means to break the duopoly enjoyed by Visa and Mastercard, who between them account for over 80% of all EU card transactions.
Visa reported strong earnings driven by growth in payments volume as more consumers use cards to make purchases, but warned that political uncertainties could affect consumer spending.
When JPMorgan Chase & Co. announced in November it would soon start mass-issuing contactless Vis
American Express has blocked attempts by Curve to load Amex cards into its all-in-one wallet, just days after the UK startup announced support for the feature.
Petal, a US credit card startup that is ditching traditional credit scores in an effort to sign up young people and the underbanked, has closed a $30 million Series B funding round led by Peter Thiel's Valar Ventures.
Synchrony Financial said Walmart has agreed to drop a lawsuit against the bank that alleged it breached the terms of their long-running credit-card deal.
The European Commission has bashed Mastercard with a EUR570 million fine for obstructing merchant access to low-cost cross-border payment services.
Merchant plaintiffs and the state of New York filed motions Tuesday in a federal appellate court to
Major perks like airfare and cash back were meant to lead to higher returns. But consumers figured out how to game the system. Now banks are trying to figure out how to keep customers happy while cutting extras.
SIX Payment Services has issued a SIM-based virtual credit card for making mobile payments in Austria.
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Curated by Vineet Anand
Payment Industry leader passionate about Fintech, Innovation in Banking, Product Management & Strategy, driving revenue growth through client management, business development and P&L focus.
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US Household Debt Hits Record High: A Detailed Analysis
US household debt reached a record high with an increase of $184 billion, or 1.1%, from the last quarter, according to the Federal Reserve's latest quarterly report. Here are some key takeaways and insights from the data:
Debt Overview:
Delinquency Rates:
Economic Concerns: While the stock market has reacted positively to signs of slowing inflation in the CPI report this week, underlying economic activity remains a concern. Higher interest rates are expected to persist until at least November, with a potential reduction in September only if CPI continues to show a decline for the next three months.
Banking Sector Implications: Banks are likely to see increased activity in several areas:
Consumer Struggles: Inflation, particularly in food and rent, coupled with high interest rates, is creating significant financial strain for consumers. This is leading to increased reliance on credit cards and home equity loans for those who own homes. Buy Now, Pay Later (BNPL) services are also contributing to the debt burden, with 43% of BNPL users behind on payments.
Bank Fees and Bankruptcies: Despite consumer struggles, banks continue to benefit from non-interest income through late fees, with 121,000 bankruptcy notations recorded this quarter and 4.8% of consumer debt in third-party collections.
Looking Ahead: The past three months' data highlights the economic challenges consumers face. Banks will need to reassess risk management and policy measures to protect against rising credit lines with fewer delinquencies. Additionally, they must consider the broader picture of their commercial real estate (CRE) exposure, with close to $1 trillion in loans maturing this year.
This report underscores the need for vigilant financial strategies as both consumers and financial institutions navigate these challenging economic times.