Information Center – News and Articles about Credit Cards
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Credit Cards: Statistics and Trends
Active credit card use is a sign of a society with well-developed market relationships. More and more people get involved in buying goods and services with plastics. Using virtual funds to make real purchases is very convenient. But this extended buying power has led Americans to a dangerous trend. Over 40% of American households, according to the USA Federal Reserve statistics, spend more money than they make.
In the average, every American of these 40% spends $1.2 per every $1 he or she earns. Plastics have changed people's spending habits. These plastic devices allow and encourage people to spend more and more money. Around 18% of all purchases made by Americans involve credit card use. About 24% of the purchases are made with other types of plastics.
The statistics shows that an average American has 2.7 bank credit cards, 1.1 debit cards, and 3.8 retail credit cards. If we sum this up, we will see that you can find 7.6 plastics in every person's wallet. Of course, you should not take it literally, this figure is just an arithmetic mean.
This amount of plastics, together with wish and buying power to live a better life and buy more or higher-quality items leads to debts. In today's world of great opportunities, profusion and accessibility of various goods and services, it is not easy to keep credit spending under control.
A typical American family has $8,000 debt in the average. 63% of this sum is non-circulating debt, like a car loan (you borrow a significant amount of money, then gradually pay it down without re-borrowing). As for circulating debt (a credit card debt, for instance, you constantly borrow money and pay off a part of the debt on a regular basis), it makes up the rest.
Speaking of non-circulating debt, it should be mentioned that the greatest part of it stands for mortgage debt. Though mortgage rate is considerably lower, as compared to lowest APR credit cards, around 6%, the county's overall mortgage debt keeps rising. Now that real estate industry is going through hard times after the sub-prime mortgage crisis, mortgage loans are getting less available and more difficult to pay off.
That is how things with lending industry stack up today. As for the nearest future, a lot of new technologies in the sphere of credit are being developed these days. One of the latest innovations on the credit card market - a new payment system - has been introduced recently in Texas. Card owners can make credit card purchases without a plastic. How is this possible?
With new cash registers Security Touch, customers can buy items at local supermarkets with help of their hands. Literally. With the help of their fingertips, to be more exact. Cash registers store database with credit information about all card holders and their fingerprints. Texans can make purchases just pressing their fingertips to the screen. The register reads the information and makes all necessary transactions.
This biometrical system of making payments is not just convenient. It makes the process of paying for goods even faster than it is with plastics, and safer. The system almost eliminates a possibility of credit card fraud. Every week 10-15 new customers register to be able to use Security Touch. The registration is fast and easy. A driver's license, a plastic and fingerprints are what customers need to register.
Nobody knows what is going to happen in the next few years and what other new credit card services will be launched. Maybe we will be able to shop with a blink of an eye.
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The XXI century is the century of high-speed and nanotechnologies. It seems people strive to speed up all processes to make this already hectic and sometimes chaotic rhythm of life even crazier. They are ready to shrink everything they can lay hands on to make nanotechnologies work. In fact people just want to make their life more convenient.
Contactless credit cards are another product designed to upgrade our life quality through saving customers' time during the checkout process. These new-age credit products are gaining more and more popularity with customers. The so-called wave card makes the checkout process easier and faster. The recent opinion poll proves that contactless plastics won many hearts. According to the survey's result, over 90% of wave cards owners find them to be very convenient and user-friendly. Plus such plastics are accepted nearly everywhere regular credit products are accepted.
The financial economy crisis in the US has been admitted the largest financial shock for America since Great Depression. US banks incur billion-dollar losses. The number of delinquencies keeps rising. Associated Press has announced the results of data processing on 17 trusts dealing with securitization of credit cards.
The results leave much to be desired, to put it mildly. The volume of credit card debt with a delay of 30 or more days has gone up by 26% as compared to October, 2007. Now it makes up $17 billion. It stands for over 4% of credit card debts. The information on card holders debts for Associated Press was provided by Bank of America and Capital One.
We are used to see credit cards the way they look today, and it is hard to imagine that they looked different and served for another purpose than paying for goods and services. We call them plastics. In fact, a century ago credit cards had a different shape, size and were not made of plastic.
The appearance of credit cards dates back to the beginning of the XX century. Who were they created for? The target audience was wealthy people. The cards could be used as business certificates and licenses for the so-called "loyalty programs" at some restaurants, gas stations and merchants. Those cards, you can be surprised, were made of cardboard.
Rapidly growing credit card crime rate causes more and more concern of credit consumers and credit providers as well. Credit card fraud is a number one card holders complaint to Federal Trade Commission. According to the statistics, over 85% of credit card owners that fell victims to credit scam discover the fraud only after they get turned down by credit issuers, having applied for a new credit card or loan.
Credit bureaus cannot stay indifferent to the problem of credit fraud and identity theft, in particular. Equifax, one of the three US major credit bureaus has introduced a new ID theft protection service. "ID Patrol" is a multifunctional tool that allows protecting customers from identity theft.
