Today, we’ll be taking a look at some essential and interesting links and articles from around the web on the topic of credit cards. With the economy in a rut and new credit card and banking legislation on the horizon, now is an especially important time to be aware of all the news and views buzzing about. Here at MYC, we read a lot of material, but only a fraction of it gets incorporated into our daily writeups. This link round up is meant to give our readers browse the bigger picture:

Wall Street Journal has a nice article on services providing more condensed versions and “free credit scores,” though they may not be the ones you will get from Experian or FICO…

There is variation among credit scores, depending on which scoring model is being used and which credit bureau the data are pulled from. Lenders can choose from FICO, the VantageScore—a score developed by the three credit bureaus—or from any one of the credit bureaus’ own scores. Adding to the confusion, lenders can choose from multiple versions of the same scoring model. FICO, for example, recently rolled out its latest version, FICO 08.

Washington Post has an article on credit being replaced by debit cards. Excerpt:

Nine months ago, Alyson Chadwick, a public relations representative for a nonprofit organization on Capitol Hill, got a debit card with a MasterCard logo so she could use it anywhere for purchases. Carrying cash was unsafe, she thought, and a debit card would help her manage her spending better.

“I use my credit cards hardly at all,” she said. “I don’t even carry them with me.”

Trish Preston, head of U.S. debit for MasterCard, said the changing fortunes of debit and credit tell the story of how the recession has transformed consumer spending.

“Think about what’s happening in the economy,” she said. “Appliances, furniture, jewelry: Those are very sensitive to the economy, and those have generally been credit spending categories.”

Debit cards, meanwhile, tend to be used for routine necessities such as groceries and gasoline. “Those kinds of expenditures are happening,” she said.

New York Times has an interesting video explaining overdrafts as part of its ongoing (and excellent) The Card Game series.

Local Oklahoma news station KFOR has this warning about drug traffickers using gift cards to steal credit card information.

Even though you still have your actual credit card, people steal your card info and use it to open a new account in their name. And even when it’s canceled, they still have buying power through gift cards. Thieves are cloning credit cards and spending to the limit and buying gift cards before the victims can catch them.

Detective Scott Stephens said, “By the time you find out your account has been compromised, they’ve already bought these gift cards, flat screen TVs or whatever.”

Then the credit card holder is out of luck and sometimes thousands of dollars.

Readers speak out on frustrations over international credit card use over at the NYTimes blog:

Amar, from Lansdale, Pa., wrote about trying to call India from a payphone in Paris’ Charles de Gaulle airport. But his card was rejected, so he had to make an operator-assisted call. “The 2-min call cost,” he said, “$37.”

Mcooper from Canada had to wait 45 minutes at a toll booth in France because an attendant had to manually swipe the card. “The chip and pin card holders zipped through the automated kiosks,” mcooper wrote. “In restaurants, the younger servers did not know how to swipe our card. It was new to them.”

Jeremy Simon at CreditCards.com predicts that holiday sales will be off this year thanks to less credit card clout in consumer wallets:

Holiday sales will be down 1 percent this year, according to the leading retail trade association, with lackluster spending by consumers unlikely to get a boost from Christmas presents put on credit cards.

According to the National Retail Federation, frugal-minded consumers are likely to shift away from credit cards and instead put holiday buys on debit cards and cash.

“Many consumers don’t like to rely on credit cards,” says National Retail Federation spokeswoman Ellen Davis, in a conference call accompanying the release of its holiday sales forecast. Davis blamed consumers’ reluctance to use plastic on the ongoing credit crunch and the fact that consumers don’t appreciate being surprised by card statements received in December and January.

The Seeking Alpha blog summarizes Jim Cramer of Mad Money who says that Visa has “great earnings visibility” in spite of the recent turmoil. Why? Because they’ve got a big chunk of the debit card market:

More cash-conscious consumers are using debit cards because they fear relying on credit, and Visa has double the market share of Mastercard in the debit card space. It’s strong credit card business is also a good way to trade an economic recovery.

According to The Frederick News, MasterCard has drafted a response to 7-Eleven’s petition regarding their grievances over swipe fees for merchants. MasterCard’s view: 7-Eleven was deceptive in appealing to consumers and should suck it up and pay the fee as part of the cost of doing business. Take it with a grain of salt:

“It’s undeniable that electronic payments drive value for all merchants,” McWilton said. “It’s surprising that 7-Eleven, a company that prides itself on convenience, would mount such an aggressive campaign against the most convenient form of payment.”

Caufman said credit card use far outweighs cash transactions at her store.

MasterCard Worldwide said lowering or eliminating such merchant transaction fees could result in higher charges to use the cards and less benefits.

“In my view 7-Eleven’s campaign was willfully deceptive,” said Eric Grover, a principal at Intrepid Ventures, a leading payments industry consultancy, in a prepared statement. “It invited unsuspecting consumers to petition for government regulation that will cause higher card fees and a reduction of the benefits they take for granted.”

Wondering what to do with all those credit cards you paid off and canceled after the rates got jacked? Make your old credit card into an iPhone stand with these instructions from instructables.com:

I travel quite a bit and have always been searching for stands for whatever PMP (personal media player) / iPod / PSP / iPhone or whatever gadget I’m currently using to watch movies while flying. the catch is the stands have to be small and easy to transport and still work well.I tried the business card one, some origami ones and some other mediums (I had cut one from plastic) but they all were either too involved to recreate midair or not sturdy enough to hold the thing at the right angle.I happened to have a hotel room key in my shirt pocket and mangled it into something that I now find myself dependent upon for my iphone holding needs. I like the fact that I can reuse something for another purpose and hey, they’re free! It works well in coach as well as first class and haven’t hit any turbulence rough enough to unsettle it. :D

Key to Eden points to this eye-opening chart from Mint.com that breaks down the costs of rewards programs:

Ever wonder how much you’re really getting back from credit card and retail reward programs? Personal finance site Mint.com breaks down the fees, catches, and mentality behind some major retailers’ cards and shopper programs in a big ol’ chart.

Mint and WallStats.com do a pretty great job of making their chart flow sensibly and read well, taking you through what major credit card issuers, grocery chains, and big box stores want you to think when signing up for a reward/points program, then breaking down each program on a cents-back-per-dollar basis. There’s also a guide to being a “Reward Points Ninja,” and the read through the whole thing should make you reconsider whether retail allegiance is really worth the hassle.

NY Times blog has a piece from Steven M. Davidoff discussing the “Inevitability of Finance.” Good food for thought about a world that relies on credit:

Remember when you (or your mother) raced to the bank to cash a check before it closed at 3 p.m.? Remember a world without credit cards and cash machines?

Finance and technology have pushed us beyond those days. This is now a world of structured products, where the income stream from toll roads can be securitized and the proceeds used to build more transport; private equity can act to discipline companies and help them operate more efficiently; the securitization process can permit widespread mortgage financing; and venture capital can fund the companies of tomorrow.

This is a world that Main Street does not see, but is the core of today’s finance. For example, according to the International Swaps and Derivatives Association, currency swaps, which allow companies to hedge currency risk when trading abroad, recently had a notional value of $414 trillion.

How about you, readers? See anything good around the web? Are you still angry about overdrafts? Do you think Bank of America are sleezeballs? Are you using debit more than credit? Sound off in the comments.

Photo  by WoodleyWonderWorks

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