Fed’s cap doesn’t fit retailers’ needs

Posted by administrator | 10/07/11 | Tagged Credit Card

Fed’s cap doesn’t fit retailers’ needs
News from The Free Lance-Star:
Every time you swipe your debit card in a store, it costs the retailer money. Soon, because of a new cap on fees, it may cost a little less.

The Federal Reserve recently agreed to limit “interchange,” or swipe, fees, which are fees merchants pay to banks and credit card companies when you use your card to buy something.

Last year’s Wall Street reform bill opened the door to capping those fees but turned the issue over to the Fed to set the limit. That resulted in months of intense lobbying by banks, which didn’t want caps, and retailers, which do.

Federal Reserve officials initially proposed a cap of 12 cents per transaction but in the end raised it to 21 cents, angering retailers who had lobbied for a lower cap. The current average fee is 44 cents. The new cap also lets banks charge 0.05 percent of the purchase amount, and 1 cent to cover fraud prevention efforts. Effectively, that makes the fee an average of 24 cents per transaction.

Financial institutions wit…………… continues on The Free Lance-Star
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Biz Bits: Unemployment checks soon to become unemployment cards
News from Enterprise-Record:
If you’re unemployed in California, change is coming in the way you receive monthly state unemployment benefits.

California’s UNEMPLOYMENT DEVELOPMENT DEPARTMENT announced last week that debit cards will replace the paper unemployment checks that arrive in the mail.

The cards will arrive in the mail, however.

It’s not clear how long it will take the state to mail out all the debit cards, but it’s likely to be a couple of months before they’re all out. There are more than 1 million people in California getting checks.

Behind the move, according to the EDD, is more convenience for recipients, and a safer way for the state to distribute money. It also saves the state about $ 4 million a year in postage.

For those who haven’t used debit cards, they’re similar to a credit card, but allow a merchant to take funds immediately out of an account. They are swiped through a point-of-sales machine or handed to the clerk for use.

Besides unemployment payments, t…………… continues on Enterprise-Record
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Consumer Debt Rises For Eighth Straight Month

Posted by administrator | 10/07/11 | Tagged Credit Card Debt

Consumer Debt Rises For Eighth Straight Month
News from Consumer Affairs:

In the months immediately following the 2008 credit crisis, consumers for the most part drastically reduced their use of credit cards. Now, they’re reaching again for their plastic.

The Federal Reserve reports consumer credit rose in May for an eighth straight month, mostly because of – you guessed it – credit card use.

According to the Fed’s data, credit rose by $ 5.08 billion after a revised $ 5.67 billion gain in April. The increase was more than $ 1 higher than the consensus projection.

Buying necessities

It’s not that consumers are using their credit cards to buy big screen TVs and go on expensive vacations. Since many consumers use their credit cards for gasoline purchases, and gasoline costs have risen in the last year, it stands to reason that gasoline is responsible for a part of the rise in consumer credit.

Other economists suggest that consumers are also turning to plastic to buy groceries and pay for other day-to-day needs. Revolving deb…………… continues on Consumer Affairs
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Time to play hardball with credit companies
News from Herald Times Reporter:
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