Visa Enables Crypto Withdrawals on Debit Cards in 145 Countries
Visa is doubling down on cryptocurrency adoption by enabling another method to exchange crypto to fiat currencies without using a centralized exchange. Visa has partnered with Web3 infrastructure provider Transak to introduce cryptocurrency withdrawals and payments through the Visa Direct solution. The new integration allows users to withdraw cryptocurrencies like Bitcoin directly from a wallet like MetaMask to a Visa debit card. Available immediately, the integration enables one to exchange crypto to fiat and pay at 130 million merchant locations where Visa is accepted. [Coin Telegraph]
How Visa and Mastercard are Embracing Blockchain
Blockchain technologies and digital currencies might initially appear to be a threat to traditional financial institutions like Visa and Mastercard. Yet these debit and credit card network operators, which have a combined market share of more than 70%, are exploring blockchain for fast cross-border payments and cryptocurrencies for card payments and rewards. Visa and Mastercard recognize that, as blockchain technology adoption increases, they risk being left behind. They’re also keen to secure a share of the revenue generated from the flow of funds to and from blockchain networks. [Techopedia]
Many Consumers Carrying a Credit Balance Know It’s a Bad Idea
Americans know that carrying a credit card balance is a bad idea, but 45% typically do so anyway, a Quicken survey said. Consumers of all ages and financial backgrounds are amassing credit card debt, and struggling to live within their means, and these behaviors are only getting worse. Roughly 77% said they owned a credit card. Most Americans (81%) said paying off credit cards was essential and 64% said carrying a credit card balance was not a good idea. However, 45% typically carry one month-to-month. Even more concerning, over 52% of Gen Z and Millennial Americans say their credit card balance has been steadily growing over the past three to five years, with almost half (48%) admitting to this in America’s middle class and over a third (35%) in the highest income bracket of those making more than $200,000. [Fox Business]
The Federal Reserve Holds Interest Rates Steady But Signals Rate Cuts May Be Coming
The Federal Reserve held interest rates steady on Wednesday but signaled that rates could fall in the coming months if inflation continues to cool. Policy makers have kept their benchmark interest rate between 5.25% and 5.5%, the highest in over two decades, since July. Fed chairman Jerome Powell told reporters Wednesday that interest rates are unlikely to go any higher, and that he and his colleagues are beginning to contemplate cutting rates. [NPR]
Mastercard Jumps into Generative AI Race with Model It Says Can Boost Fraud Detection by Up to 300%
Mastercard says it has built its own proprietary generative artificial intelligence model to help thousands of banks in its network detect and root out fraudulent transactions. The company said its new advanced AI model, Decision Intelligence Pro, will allow banks to better assess suspicious transactions on its network in real-time and determine whether they’re legitimate or not. [CNBC]
Visa Is Sued over ‘Vanilla’ Gift Card Scam
Visa was sued on Tuesday by consumers who said the card payments network failed to make prepaid “Vanilla” gift cards less likely to being drained by thieves. According to the complaint, the non-reloadable debit cards are sold at CVS, Target, Walgreens and other grocers and retailers in thin cardboard sleeves that thieves can open and, after recording account information, reseal without being detected. Thieves can then monitor to learn when money has been loaded, and make purchases using the stolen account information. [Reuters]
Dillard’s, Citi and Mastercard Announce New Credit Card Agreements
Dillard’s, Citi and Mastercard have entered into new agreements to provide a credit card program for Dillard’s customers. Citi will purchase the existing Dillard’s credit card accounts. Meantime, Mastercard will serve as the exclusive payment network for co-branded cards offered under the new program. The Dillard’s credit card program from Citi includes a new co-branded Mastercard as well as a private label credit card. The new co-branded Mastercard will replace the existing co-branded card. Additionally, Citi will provide customer service functions. [Electronic Payments International]
Amazon to Offer Buy Now, Pay Later in Mexico via Fintech Kueski
Amazon is partnering with Mexico fintech Kueski, which focuses on “buy now pay later options” and personal loans, to offer payments in bi-weekly installments in Latin America’s second-largest economy. The partnership marks the first time Amazon Mexico will allow users without a credit card to make purchases of up to 12 bi-weekly installments. Kueski will provide the financing for the purchases as well as determine the credit given to each user. [Bloomberg]
CFPB Proposal for Wallet, Digital Asset Oversight: Republicans Want It Revisited
Last year, the CFPB proposed a rule to supervise non-banks that provide payment services. That will include wallets and digital asset service providers. Yesterday, three senior Republicans on the House Financial Servies Committee sent a letter on the topic to the CFPB. They want it to reconsider the rule and reopen the comment period, which closed on January 8. The regulators argue that the CFPB proposal fails to assess compliance costs and impact on competition, which could hurt consumers. When the CFPB first announced the proposed rule, it explicitly mentioned BigTech and “other large technology firms, digital payment apps and wallets” as the target. The detailed statement specified there are 17 relevant large entities. It proposed a threshold of five million annual transactions to be considered as large. [Ledger Insights]
Wha Are Credit Card Surcharges and Where Are They Legal?
Along with all of the increased credit card usage, there’s been an uptick in surcharges. For a long time, these fees were not felt by consumers, but between the increased number of customers paying with a credit card and the rise in the cost of doing business in recent years, surcharges are becoming far more commonplace as a way to help merchants cover their own expenses. While adding surcharges to the cost of a purchase is now legal in nearly all states, businesses and merchants must follow rules regarding how such fees are implemented. In addition, each credit card brand has its own rules that merchants must adhere to. Some of the guidelines include: clear disclosure of fees prior to transaction; surcharges must be listed on receipt; a cap of 4% on surcharges; and no surcharges for debit cards. [Fortune]
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