This Week In Credit Card News: Making Your Debit Card Safer; Data Breaches Were Avoidable
More Than 90% of Data Breaches Could Have Been Avoided
Nine out of 10 data breaches that occurred in the first half of last year could have been avoided. A new report analyzed more than 1,000 breaches that involved personally identifiable information. It found that 40% of breaches stemmed from external intrusions; 29% were caused by employees; 18% stemmed from lost or stolen devices or documents; 11% were the result of social engineering.
How to Make Your Debit Card Safer
Although debit cards remain our most preferred payment method, their popularity continues to shrink, likely due to the fraud and risk concerns of consumers. In 2014, 43% of consumers said they preferred to buy with debit cards, compared with 49% the previous year, and an overwhelming majority in the past decade. Meanwhile, consumers preferring credit cards held steady at 35% both years and now include those 65 and older by a 2-to-1 margin. Credit cards may offer more protections beyond the risk of fraud, and there are certain scenarios where you should never use debit cards. But debit cards help you avoid debt and possible interest charges. Here are ways to make them safer.
The Need for a National Data Breach Notification Law
Currently, 47 states have their own data breach notification laws. So if a company doing business in multiple states faces a large breach of personal information, that company will immediately be obligated to identify and comply with a patchwork of state laws. These laws may impose different requirements on when and under what circumstances notification is required, and on the method and the content of the notification. In some states, failure to follow these specifications can result in fines, penalties or lawsuits. The result: at a time when immediate response and remediation is critical, these organizations and their counsel must first ascertain and negotiate compliance with any and all state laws that may be applicable to that specific breach.
Amazon Abandons Digital Payments, Leaving Fight to Apple, Google
Amazon said that it is killing its mobile wallet. Amazon Wallet let consumers store gift cards and loyalty cards on their phone to use for in-store and online purchase. But unlike digital wallets from Apple and Google, Amazon’s application didn’t store credit or debit cards.
Supreme Court Rejects Retailers’ Bid to Lower Debit Card Fees
The Supreme Court handed banks a victory when it declined to consider a challenge by retailers to Federal Reserve regulations setting fees for processing debit card transactions. The high court’s action removes uncertainty for the banking industry by ending a three-year federal court battle over fees associated with tens of billions of debit card transactions annually.
Mobile Payments Quickly Changing the Transaction Industry
Mobile payments are no longer just a trendy way to make a payment. They are quickly becoming the major force in the transaction industry. Mobile payment volume in the United States is projected to increase at a five-year compound annual growth rate of 172%. By 2019, mobile payments will make up nearly 15% of the total payment volume in the United States, accounting for $818 billion in transactions. Apple Pay and its early success is a significant part of this growth. But another factor is the use of mobile payments by the underbanked. Unbanked and underbanked spenders have easily adapted to mobile payments because they allow for fast transaction processing and easy financial management.
MasterCard Announces a Credit Card Even A Security Fanatic Can Love
If there was a ever credit card that could ease your anxiety about credit card fraud, the new MasterCard (MC) “Hidden,” coming to market later this year, would be it. Hidden is a computer masquerading as a fully functional payment card that works everywhere via swipe, tap, or online entry. The card features several layers of protection you won’t find on your run-of-the-mill credit card, including a light that indicates when the card is “on” and usable.
Apple Pay Helps Security, But it’s Not Foolproof
With the introduction of Apple Pay, mobile wallet payment systems promise to disrupt long stagnant payment card industry. But will these new services make our data and transactions safer? On paper, Apple Pay greatly improves data and transaction security, but it’s not foolproof. As usual, hackers are not standing still. A researcher in Germany recently demonstrated how to replicate fingerprints with a high-quality photo of a user’s fingers, which could presumably be used to gain access to anything protected by biometric data.
Is Google Set to Acquire Mobile Payments Service Softcard?
Google may be in talks to acquire Softcard, a mobile-payments service, in a bid to boost its Wallet and compete against Apple Pay. Softcard, formerly known as Isis, was started jointly by AT&T, Verizon Wireless, and T-Mobile USA in 2010. The company claims that it can be used at over 200,000 merchants, including McDonalds and Subway. Softcard allows consumers to make payments through connected debit and credit cards from American Express, Chase, Wells Fargo and others banks. Reports indicate Google recently entered exclusive discussions with Softcard by offering to buy the service for at least $50 million.
LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.41%, slightly lower than last week’s average of 14.44%. Six months ago, the average was 14.49%. One year ago, the average was 14.46%.