Credit Card News: Important Payment Card Topics to Follow in June




Given the many adverse things happening with the economy, it's more important than ever for consumers to do as much as possible to manage their spending habits and reduce unnecessary expenses. Sluggish employment numbers, continued pandemic and supply chain disruptions, inflation at national and international levels and Visa and Mastercard processing and transaction fee increases are just some of the many cost of living problems that experts believe will only worsen before 2023.

In June, payment card users need to keep their eyes on the following two topics to help them protect their finances:

Increase of Merchant Purchase Minimums And Fees



Economic woes have prompted many merchants to prevent or recoup the worst of their debit and credit card processing fees at their registers and other point-of-sale spots. A customer might see a sign at a business or online that says that they can't use a credit or debit card for transactions priced below a particular amount. They might also see a sign that says that they must pay a transaction fee for using a payment card. Consumers often wonder about the legality of these actions since merchants are essentially passing the cost of doing business to their customers.

Of course, there's no easy answer. In most states, a merchant can tell their customers that they won't accept cards below a certain amount or purchase minimum up to $10. This rule can't usually apply to debit cards. With a processing or transaction fee, also known as a surcharge, the merchant might do business in a state that has made this type of action illegal or charge a fee that's considered too high. In both cases, the merchant must typically apply any passthrough changes to every credit card they accept without favoring some branded cards over others.

If you come across either of these scenarios, always pay with cash the first time whenever possible and then research whether the merchant is breaking any rules. After all, you don't want to unnecessarily pay extra interest because you had to buy more at the point of sale to reach the minimum purchase amount or pay a transaction fee in addition to any fees your card company charges you for the privilege of paying with credit or debit.

Investigations of Credit Bureau Activities



During the pandemic, several investigations, including one by the Consumer Financial Protection Bureau (CFPB), found that Equifax, Experian and TransUnion repeatedly harmed consumers in a variety of ways. For example, they failed to fix errors on credit reports in a "timely" fashion or at all after consumers lodged complaints or disputed transactions related to identity theft, fraud and other crimes.

According to the Fair Credit Report Act (FCRA), each credit bureau is required to block any inaccurate information related to crimes within several days after a consumer notifies them of a problem. They must also place a seven-year fraud alert on your account upon request with a flag that warns lenders that you're a victim of identity theft or other forms of fraud and that they need to check with you before they allow any new accounts to be opened in your name. The alert also helps each credit bureau warn the others of possible fraudulent activities.

Last month, consumers were also warned that credit bureaus are selling their data to lenders as "trigger leads" that help companies target promotional campaigns to consumers who fit specific demographics and markets. Lenders use the leads to make cold or unsolicited contacts that do more than cause telemarketing-related irritation. Many new cases of identity theft and fraud started with a credit bureau selling data in this way.

As a result, Congress plans to investigate the current error complaint and dispute processes along with other practices performed by the three major credit bureaus. It's a well-known fact that a person's credit history impacts nearly every major aspect of their life. Serious errors and fraud details that credit bureaus fail to fix quickly can damage a person's credit and make it difficult for them to buy a car, home or acquire a loan. A bad credit history or score can even result in a consumer losing a job or housing lease. Congress also has concerns about repeat data breaches experienced by the bureaus that cause additional identity theft, fraud and credit history and score damage and deceptive marketing practices that push consumers to sign up for expensive subscriptions and services on the websites of the bureaus or their affiliated partners.

Things to Keep in Mind



You can't stop merchants from placing limits on payment card transactions or increasing related fees. You also can't stop credit bureaus from continuing to act as if they answer to no one. The best you can hope to do is stay aware of these issues, approach risks with caution, perform your own investigations as needed to prevent fraud and use common sense when using credit and debit cards. You must also heavily advocate for yourself any time you feel that you've been treated unfairly when dealing with payment card accounts and transactions.





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