This Week in Credit Card News: Your Face May Soon Verify Your Mobile Purchases; How Covid Changed Banking And Card Use
Facial Recognition Could Soon Let You Pay for All Your Mobile Purchases
Using facial recognition for payment authentication is set to transform the world of e-commerce by 2025. A report from Juniper Research claims the use of such software is set to rise 120% from just 671 million in 2020, with software-based facial recognition set to exceed 1.4 billion worldwide users by 2025. The rise is largely attributed to affordable accessibility, as millions of mobile users now have a front-facing camera and compatible software such as Apple’s FaceID.
How Covid Changed Consumer Banking and Credit Card Use
Financial firm FIS investigated how the pandemic has impacted how consumers bank and use credit and unearthed some shifts in behavior. Emphasis on digital gives context to banking preferences in the past year: 37% of those surveyed began a new banking relationship with a major national or global bank in the past 12 months. 18% opened an account with an online-only direct bank. Consumers may have been opening bank accounts, but credit card usage fell sharply. Payment innovations such as ‘buy now, pay later’ could bridge the credit gap for the younger generation who shirk traditional credit cards.
Mastercard is Acquiring Identity Verification Company Ekata for $850 Million
As online identity management grows in importance, Mastercard swooped in and bought identity verification company Ekata for $850 million. Mastercard certainly sees the rapid digital transformation that is happening in online commerce, a move that was accelerated by Covid. With Ekata, the company gets a solution that can verify the online identity of a person making the transaction in real time. The company provides a score and other data that predicts the likelihood this person is who they say they are. It’s like a credit risk score, except for identity.
Capital One Adds New Airline and Hotel Partners to its Credit Cards, Improves Transfer Ratios
Capital One credit card holders have reasons to rejoice. The issuer announced the addition of four new transfer partners—-British Airways, TAP Air Portugal, Turkish Airlines and Choice Hotels—-to its credit card rewards program, along with improved transfer ratios for several existing partners. The issuer also revealed plans to open its first two airport lounges and launch a new Capital One Travel website. In 2018, Capital One added the ability to transfer miles to over a dozen airline and hotel partners, which created an opportunity to get much more value out of Capital One rewards.
Apple Just Introduced a New Way for Families to Share the Apple Card and Build Credit Together
Apple introduced Apple Card Family, a new way for people to share their Apple Card, track purchases, manage spending and even build credit together. Apple Card Family will be available in the U.S. come May, and will allow two people to co-own an Apple Card and share their credit lines. It’s similar to adding an authorized user to your credit card, with some important distinctions. Apple Card customers can add up to five people above the age of 13. Parents can set spending limits and controls for their children’s spending.
PayPal Mobile App Enables Selling, Buying and Holding of Cryptocurrency
The Venmo mobile payment app owned by PayPal recently announced that it has started allowing its users to sell, buy and hold cryptocurrencies on its platform, a significant step in the mainstream adoption of cryptocurrency. Beginning last April 20, the mobile application management said that they will show their users a new feature that enables them to invest in different digital currencies for as little as $1 with the transactions recorded on the app’s feed. A customer survey conducted by Venmo team revealed that in 2020, 30% of its customers have bought digital currencies or equities.
The Diminishing Role of Credit Card Loyalty in a Post-Pandemic World
With most travel companies expecting a flood of demand this summer, loyalty program experts caution it may be the right time to cash out points before airlines and hotels devalue them. Airlines like American, United, and Delta used their loyalty programs as collateral to refinance and raise money during the pandemic. Hilton pre-sold $1 billion worth of loyalty points to American Express last April to generate cash during the worst financial point of the pandemic. But a move like this floods the market with more points, and eventually the laws of supply and demand will kick in: more points in the market means they’re going to be worth less.
How JPMorgan Chase Got European Football So Wrong
JPMorgan Chase agreed to finance a breakaway competition of some of the world's richest soccer clubs. But following massive blowback from fans, the sport's governing bodies, UK Prime Minister Boris Johnson, French President Emmanuel Macron and even the British royal family, efforts to form the European Super League have crumbled in a matter of days. JPMorgan, which provided a $4.2 billion loan to get the project started, is now being painted as a willing accomplice to billionaire club owners out to line their own pockets while undermining one of Europe's prized cultural assets with its roots in working-class communities. The bank has faced criticism and mockery on social media for its role in the deal.
Citi Streamlines Corporate Disbursements with Mastercard Send
Citi’s commercial banking clients may eliminate more checks by sending funds directly to consumers’ debit or prepaid card accounts through an integration with Mastercard Send. Citi is the largest global treasury bank so far to implement Mastercard’s direct debit service. It is adding Mastercard’s direct debit function to its Citi Payment Exchange service, which supports secure storage of a payee database with enrollment services, all controlled through an administrative platform.
Mastercard Announces an Investment and a Partnership in Black-Owned Businesses
Mastercard announced a multimillion-dollar investment in Fearless Fund, a venture capital firm founded by Black women with the mission of investing in minority female entrepreneurs. The credit card giant also unveiled a partnership with Greenwood, a fintech firm aimed at Black and Latino consumers and business owners, to issue the platform’s first debit cards.
Southwest Just Launched a Subscription Plan for Buying Points
Southwest has just introduced a new way of buying Rapid Rewards points: via an installment plan. The idea is that you sign up to purchase a set number of points each month at a discounted price. Then, you’ll get a points bonus awarded every three months. Although you can cancel at any time, the longer you subscribe, the more bonus points you’ll earn.
Trends Reshaping Rewards Within the Credit Card Industry
We all know them. The family friend who takes a weeklong vacation booked solely on points every six months. The co-worker who stacks points to go on the end-of-year shopping spree practically for free. For years, these hyper-efficient rewards users didn’t exist. But today, that’s changing. Here are some factors that are reshaping rewards within the credit card industry.
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