Most Americans skeptical of crypto; Walmart is suing Capital One to end its partnership

The majority of Americans are not sure about the safety and reliability of cryptocurrency

Among the vast majority of Americans who say they have heard at least a little about cryptocurrency (88%), three-quarters say they are not confident that current ways to invest in, trade or use cryptocurrency are reliable and safe, according to a Pew Research Center survey . This comes out to about two-thirds of all American adults. While concern about cryptocurrency is widespread, some groups of Americans are more worried than others. For example, adults aged 50 and older who have heard of cryptocurrency are more likely than their younger counterparts to say they are unsure about its reliability and safety (85% vs. 66%). Women are also slightly more skeptical about investing in, trading or using cryptocurrencies. [Pew Research Center]

Walmart is suing Capital One for ending its credit card partnership early

Walmart is suing Capital One to end its credit card partnership agreement, alleging that the bank is not meeting its customer service standards as the exclusive issuer of Walmart’s private label and co-branded credit card program in the US. According to the lawsuit, Walmart is seeking to terminate a deal it entered into with Capital One in 2018 “worth over a billion dollars.” Capital One struggled to meet its contractual obligations to Walmart, the lawsuit alleges, and failed to measure up to its retail partner’s customer service standards in “at least five critical service areas” over a 12-month rolling period. [CBS News]

Credit card debt exceeds excess savings for the first time since 2020

Households face a shrinking reserve of savings and a growing mountain of high-interest consumer debt. Although inflation may be on the way back, increases in the cost of living over the past two years have eaten away more than half of the stockpile of savings that households amassed during the pandemic, while credit card debt has risen to record levels, according to the latest government data. The total amount of revolving debt (mainly credit card debt) held by Americans in February surpassed the total amount of additional household savings built up during the pandemic. [Investopedia]

US credit and debit card spending slows to slowest pace in two years

Credit and debit card spending rose at the slowest pace in more than two years, dragged down by slower wages, fewer tax refunds and the end of pandemic-era benefits, according to a report by the Bank of America Institute. After a strong start to the year, consumption per household rose by 0.1% from the previous year, the slowest pace since February 2021. The weakness was broad-based across goods and services. [Bloomberg]

Merchants reap financial benefits from Co-branded Store Card Momentum

In 2023, store credit cards may increase significantly based on last year’s trends. A report from LendingTree revealed that 35% of Americans were likely to apply for a store credit card during the 2022 holiday season, the second-highest percentage in five years of tracking and up from 29% the year before. In addition, TransUnion reported that credit card originations reached 12.1 million in Q3 2022, an increase of 8.4% compared to the previous year. Store credit card balances grew by 7.3%, indicating a growing interest in and use of store credit cards. However, there are obstacles to wider adoption, including low customer satisfaction — 37% of Americans who signed up for a store card later regretted it — and higher annual percentage rates than general-purpose cards. [PYMNTS]

A federal tool could soon make it easier to compare credit cards

Consumers may soon have an online tool from the federal government that aims to make it easier to comparison shop for credit cards. The CFPB said it had begun asking major banks for more details about typical interest rates for people with certain credit scores, so buyers could get a better idea of ​​whether they would qualify for a card and what interest rate they would pay. Under the agency’s new approach, banks are asked more questions about a card’s terms, such as the interest rate, known as the annual percentage rate, or APR. If a card’s price depends on the applicant’s credit score, as most do, banks must report the lowest and highest rates charged, as well as the median APR for scores of 619 or below, for 620 to 719, and for 720 and above. [The New York Times]

Plaid launches new feature to speed up bank payments

Plaid expands to offer real-time bank transfers. The updated service allows companies to pay out loans, insurance payments or salaries immediately. Plaid’s Transfer service helps businesses, mostly other fintechs, move funds between bank accounts. The product now uses the Real Time Payments (RTP) network, a five-year-old money movement platform owned by a consortium of major US banks, which allows instant bank transfers. Before support for RTP was added, all transactions occurred using the dominant, decades-old system for bank-to-bank transfers in America, the Automated Clearing House. ACH transfers typically take one to three business days, unless users pay a fee for a same-day or next-day transaction. In addition to payments, Transfer can be used to fund new accounts. [Forbes]

Mastercard launches international payment tool

Mastercard has launched a tool that helps financial institutions set up international payments for their customers, including consumers and SMEs, in more than 60 currencies to over 100 markets. Mastercard Cross-Border Services Express promises a simple integration that helps deliver cross-border payments to locations covering 90% of the world’s population. Mastercard is working with Fable FinTech and Payall Payment Systems on the service, offering users flexibility in how they pay by delivering funds to bank accounts, mobile wallets, cards and cash withdrawal locations. [Finextra]

How using a debit card instead of a credit card can help you spend less

With credit cards, the actual payment for the purchase is delayed, and that payment can be postponed, again and again. The “disconnection” of the purchase from the payment can make it psychologically easier to spend more money and lead to overspending and increasing household debt. Although credit cards can reduce the “pain of payment”, they can also reward the willingness to spend. A brain study by researchers at MIT seems to support the idea that credit cards can “press the gas pedal” on spending. Researchers found that credit card spending activates a part of the brain called the striatum that is linked to reward perception and drug addiction. Similar purchases made with debit cards or cash did not have the same effect. [CNet]

Consumers and merchants can benefit from store cards

Store cards can come with a number of benefits. For example, consumers with lower credit scores are often more likely to be approved for store cards than general cards. If these consumers are careful with their spending and diligent about paying off their balances, store cards can help them build better credit scores. One of the biggest appeals of store cards is that they typically provide customers with exclusive rewards, discounts and other benefits. PYMNTS found that 42% of consumers who used a store card reported that they did so because it gave them more rewards than other methods. Interestingly, the draw of rewards may become stronger. According to a PwC survey, 30% of co-branded credit card holders said the benefits or rewards were more valuable now than before the pandemic. It is therefore no surprise that consumers with store cards use their cards 87% of the time when they can. [PYMNTS]

How virtual assistants take mobile banking apps to the next level

Although very few banks offer true virtual assistants, more are on the way. This automated assistance feature – which includes natural language processing, artificial intelligence and predictive analytics – takes mobile banking to the next level. It helps to improve the customer experience at the same time as it opens up increasingly sophisticated functionality in the mobile banking app. Wells Fargo research suggests that younger consumers in particular are receptive to bypassing human help for a virtual assistant instead. [The Financial Brand]

The Ghost Of FTX: Bankrupt Exchange Haunts Customers With Phantom Debit Card Deliveries

Like that ex that just won’t go away, FTX finds ways to show up in people’s lives, most recently, through the delivery of branded debit cards. It’s as if the cryptocurrency exchange, which declared bankruptcy in November, is saying, “You thought it was over between us? It’s not over until I say it’s over.” A processing delay at card issuer Evolve Bank & Trust is likely to blame for this harmless but ghostly error. The website to activate the cards is no longer operational and the cards themselves are not working. This isn’t the first time Evolve Bank & Trust has been involved with a rising cryptocurrency company, the bank also issued cards for BlockFi, an exchange that filed for bankruptcy in November as well. [Forbes]