Missing More Card Payments | Increased Card Usage

Credit bureau TransUnion, an American company that provides credit information and information management services has recently reported missed payments on credit cards issued by lenders are higher than on older cards.

Credit Card Processing

Almost 3% of outstanding balances on credit cards given out in 2015 were at least 90 days behind on payments 6 months after they were originated. In 2014, the number was 2.2% and 1.5% for cards given out in 2013.

Subprime lending has recently increased, which plays a major role in this concern. Lenders increased subprime card lending in 2014. They have been giving out more of these cards recently.

On the one hand, consumer habit and ease of use contribute to the mentioned increase. On the other hand, the fact that consumers are more and more often shopping via their mobile phones boosts credit card usage as well.

According to the 2017 Mobile 500 report, mcommerce revenue was predicted to grow 53% to $220 billion in 2016. Some ecommerce growth statistics predict online sales via smartphone to surpass desktop sales by 2017. Mobile 500 ranks, profiles and details the 500 largest mobile commerce competitors across the globe by their annual mobile sales. Total global ecommerce volume is growing at less than half the mentioned rate.

Credit Vs Debit Cards. Card Fraud.

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A recent survey shows the majority of Americans (70%) would stop turning to the bank that rejected their credit card application and would apply to another bank for a credit product.

When it comes to credit and debit card usage, the amount of debit cards usage is increasing with rapid advances, which cannot be said about credit cards. This is based on a new study carried out in the field. Debit cards now count for 70% of payment cards worldwide, which is up 2% from 2014. The number is predicted to reach 72% by 2021.

As for credit card fraud, the US accounts for more than 1/3 of credit card fraud loss across the globe. The global losses for 2015 made up $21.84 billion; the US lost $8.45 billion (38.7%). Card issuers paid out $15.72 billion, and merchants and card acquirers lost $6.12 billion.

Fraudulent cards used at ATMs and payment terminals were the main reason for the credit card fraud. Global fraud loss grew by 20.6% as compared to the year 2015. Importantly, EMV liability shift in the US has helped mitigate the fraud risk in the country.

 

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