This Week in Credit Cards

Oct 24, 2014
Credit Cards, Identity Theft, Debit Cards, Current Events
  • For you history buffs, what role did Diners Club play in popularizing credit cards (NY Times)?:

    Nevertheless, it soon became apparent that Diners Club’s founder, Ralph Schneider, was on to something. Mr. Schneider, a lawyer, said he had the idea after a client told him about going to a Manhattan restaurant without his wallet and having to wait for his wife to drive in from the suburbs to bring it to him.

  • How long can they go? identifies three of the lowest interest rate credit cards in 2014.   Good to remind students that these cards only go to consumers with outstanding credit scores.  The lowest rate card they found? 6.25%

  • If you have a Citi credit card, you will be able to access your FICO score come January (WSJ Blog):

Consumers with Citi-branded credit cards will be able to see the FICO score that Citi has for them—and that it uses to make lending decisions—on their online accounts.  Citi is the largest credit-card issuer so far to join a program that Fair Isaac, often called FICO, launched last year. Participating lenders agree to provide the exact FICO score they have on their customers. Prior to this program, consumers weren’t able to view those scores, unless they were denied for a mortgage.

  • Why has the US so slow to replace existing credit card technology?  The Economist explains:

Chip-and-PIN credit cards are designed to reduce fraud. They don’t end it, of course. But they help—the adoption of chip-and-PIN in Britain dramatically reduced the rates of some types of card fraud. America is the only rich country that still relies on magnetic strips and signatures for most credit-card transactions. It is also the only one in which the market in counterfeit credit cards is still consistently growing. Retailers, banks and card issuers lost $5.3 billion to credit-card fraud in America in 2012—about half the global total. Here’s the trouble: upgrading cards (there are over 1 billion in circulation in America) is expensive. New card-readers are even dearer: upgrading all of the readers in America would cost hundreds of millions of dollars.

  • Banks moving faster to replace cards with more secure “Chip and PIN” technology (CNBC) and Obama’s executive order requires federal agencies to make the transition (CFO)
  • Carrying a significant amount of credit card debt (4 in 10 Americans carry revolving debt) but can’t pay them off right now?  Here are three options to start making progress on reducing your debt (US News and World Report)


About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.

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