PriceWaterhouseCoopers has published a new version of its Precious Plastic report for 2010 covering the card market in the UK. "2009 has been a watershed year for consumer credit in the UK, with both lenders and borrowers reassessing their balance sheets. Historically high levels of bad debt, a growing regulatory burden, continuing funding and capital constraints and the toughest macro-economic environment in a generation are placing unprecedented pressure on UK lenders. As a result, consumers will face a reduction in the availability of credit and an increase in its cost."

In an article titled "A Squeeze on Customers Ahead of New Rules", Andrew Martin and Lowell Bergman write for the New York Times about credit card issuer actions to increase interest rates and cut credit lines ahead of new rules on credit card issuers scheduled to take effect in February.

In an article titled "New York’s Cabbies Like Credit Cards? Go Figure", Michael M. Grynbaum writes for the New York Times about how New York cabbies have grown to appreciate the benefits of payment card acceptance as they've emerged as "an unlikely savior for New York’s taxi industry." When initially introduced two years ago, cabbies were very unhappy with the requirement to accept cards. According to Grynbaum, all of that has changed.

In an article in today's American Banker titled "Return of an Interchange Firebrand", Maria Aspan interviews Lloyd Constantine, the lead attorney who represented Wal-Mart and other merchants in the largest class action settlement in history involving debit card interchange fees.

Constantine's new book, Priceless: The Case that Brought Down the Visa/MasterCard Bank Cartel, was recently published by Kaplan and has been on the must read list for payments geeks like ourselves!

Aspan writes that Constantine finds current interchange-related lawsuits to be "lawyer-driven cases" - while his wasn't. As for the current legislative efforts in Congress to reform interchange, Constantine says he thinks those efforts are "well founded."

Sears has announced new benefits and new features to provide more retail value to Sears card customers, including Credit Score Access (Sears is the first major retailer to offer its cardholders access to their credit score at no additional cost), Monthly Cardholder-only Sales and a new Sears Platinum MasterCard with a new Sears Choice Rewards program. READ MORE

One hundred percent of credit cards offered online by the leading bank card issuers continue to include practices that will be outlawed once legislation passed in May takes effect next year, according to a new report by the Pew Health Group’s Safe Credit Cards Project titled "Still Waiting: ‘Unfair or Deceptive’ Credit Card Practices Continue as Americans Wait for New Reforms to Take Effect".

The report also found that advertised credit card interest rates rose an average of 20 percent in the first two quarters of 2009, even as banks’ cost of lending declined. With the Federal Reserve currently developing rules to ensure penalty charges are “reasonable and proportional” as required under the Credit CARD Act, the report also includes policy recommendations for regulators. READ MORE

In an editorial titled "Credit Card Chicanery", the New York Times continues its editorial efforts to get Congress to accelerate the effective dates for the Credit Card Accountability, Responsibility and Disclosure Act - writing that "it is time that Congress looked out less for the credit card companies and more for American consumers."

In today's editorial titled "Last-Minute Credit Card Tricks", the New York Times takes credit card issuers to task for "driving already outrageous interest rates still higher and imposing fees that are pushing struggling families further into debt." The editorial urges passage of pending legislation that would accelerate the effective date of credit card legislation signed into law earlier this year.

Bank of America reported financial results this morning for the third quarter of 2009. In its Global Card Services unit, the bank reported card purchase volumes declined over 14% year over year from $63.3 billion to $53 billion. The charge-off rate doubled - from 6.4% to 12.9% compared to the same quarter last year. Debit card purchase volume grew slightly about 3% from $53.2 billion to $54.7 billion.

In an article titled "Credit-Card Losses Underscore Challenges Facing Lenders", Aparapjita Saha-Bubna writes for the Wall St. Journal on the financial results reported by major US credit card issuers - noting that "the latest numbers indicate that consumers continue to struggle amid high joblessness, as delinquency rates, a key gauge of future losses, continue to rise for most card issuers."

In an article titled "Turmoil in Arbitration Empire Upends Credit-Card Disputes", Carrick Mollenkamp, Dionne Searcey and Nathan Koppel write for the Wall Street Journal about credit card consumer debt dispute handling via arbitration - and, in particular, about Minneapolis-based NAF - National Arbitration Forum.

TSYS has announced formation of a new division, TSYS Program Solutions, that will provide turnkey credit card programs for regional and community financial institutions — both banks and credit unions — in the United States.

According to TSYS, the new division "will provide the program development, implementation and ongoing delivery to make it easy for smaller banks to enter or re-enter the credit card market. Key to the offer is the strategic consulting services that TSYS will provide from newly-recruited card industry executives with years of experience in running profitable card programs." READ MORE

In an AP story titled "BofA to charge annual fees on rewards cards", Bank of America says it is testing annual fees ranging from $29 to $99 on its credit cards.

Consumers continue to fight the recession by saving more and paying off debt, banks are responding with more careful lending, and stressed homeowners increasingly are falling behind on mortgages on their primary residence, according to the latest Equifax Credit Trends Report for September 2009. READ MORE

In an article titled "Two sides to every story", this week's Economist takes a look at the raging debate in the US over credit card interchange fees - noting that "the tentative evidence from Australia is that caps on interchange fees for retailers have not been offset by any gain in the form of lower consumer prices."

In an article titled "In House, a Bid to Hasten a Credit Card Law", Reuters (via the New York Times) reports that Representative Barney Frank, Democrat of Massachusetts and Chairman of the House Committee on Financial Services believes that "recent actions by credit card issuers prove that lawmakers should move up the date of new restrictions on interest rates and fees." Frank's committee held a hearing on the matter earlier today in Washington - along with a look at credit card interchange fees.

The latest Federal Reserve G.19 Consumer Credit report is out for the month of August 2009 showing that consumer credit outstanding overall decreased at an annual rate of 5-3/4 percent in August 2009. Revolving credit outstanding decreased at an annual rate of 13 percent, and nonrevolving credit decreased at an annual rate of 1-1/2 percent. The rate of decline in revolving consumer credit is the steepest reported in several years.

In an article titled "For Gun-Shy Consumers, Debit Is Replacing Credit", Nancy Trejos writes for the Washington Post about how the recession has cooled consumers on credit cards while they are increasingly using their debit cards to make purchases.

In an article titled "Chase Cards Today: No Wamu DNA", Maria Aspan writes for the American Banker in Thursday's edition about how Chase Card Services has been handling the Washington Mutual credit card portfolio it acquired when Chase took over WaMu earlier this year. Bottom line: Chase is much more risk averse and decided to exit much of WaMu's higher risk cardholders.

Aspan notes: "If there is one issuer from which JPMorgan Chase is taking lessons these days, it is all the way at the other end of the spectrum from Wamu and Providian: American Express Co. ..."

The Federal Reserve Board has proposed rules amending Regulation Z (Truth in Lending) "to protect consumers who use credit cards from a number of potentially costly practices."

"This proposal is another step forward in the Federal Reserve's efforts to ensure that consumers who rely on credit cards are treated fairly," said Federal Reserve Governor Elizabeth A. Duke. "The rule bans several harmful practices and requires greater transparency in the disclosure of the terms and conditions of credit card accounts." READ MORE

In an article titled "Congress Seeks Faster Implementation of New Credit-Card Rules", Mary Pilon and Jane Kim write for the Wall St. Journal about pressures building in Congress to accelerate the implementation of the rest of the Credit Card Act's changes from February to December.

Over on his Payment Systems blog, Andy Orrock, COO at On-Line Strategies, shares some insights into transaction times for various payment card transaction times from a large merchant.

I found the time difference between credit and offline debit cards vs. online PIN-based debit cards to be interesting with PIN debit taking 1.6 times longer. Andy shares his explanation of the timing difference in the comments.

Saying it is responding to "consumer demand for a card that offers the convenience of credit with simplified rates and terms," Bank of America has announced the BankAmericard Basic™ Visa card. "The new card features one basic rate for all types of transactions, including balance transfers and cash advances. That rate, which is tied to the U.S. Prime Rate, will not change over the life of the account." READ MORE

In an article titled "Retailers Battle Credit Card Fees", Nancy Trejos writes for the Washington Post about interchange fees. She writes that "the General Accounting Office is doing a study of the fees, as required by a law signed by President Obama in May that bans many unfair credit card industry practices."

She notes that "The Merchants Payments Coalition will release a study on Thursday of how European countries, Canada and New Zealand handle interchange fees."

We'll cover the study here on Payments News when it's released.

Over on PaymentsViews.com in a post titled "The Era of Responsible Credit Card Borrowing Begins Today", Glenbrook's Bryan Derman takes a look at Chase Blueprint - saying that it "represents a significant generational inflection point in the evolution of the US credit card business."

Chase Card Services has introduced Chase Blueprint - calling it "an innovative set of features that dramatically improves the way customers can manage their spending and borrowing. Blueprint helps consumers take charge of their finances with free tools they can use to pay down balances, manage everyday spending and pay off major purchases."

Blueprint, in what Chase is saying is a "first for the banking industry", enables Chase customers to better manage their expenses – from everyday spending like groceries to major purchases like appliances or home repairs – and adjust their plan at any time without penalty. Blueprint is integrated into customers’ accounts, enabling them to create customized payment plans and track their progress on every statement, either online or on the phone working with a Chase advisor.

Chase says that the launch of Blueprint follows more than two years of planning and research focused on better understanding the way consumers think about borrowing. According to a Chase survey of 4,026 U.S. consumers, 74 percent say it is “very important” that they have complete control over managing their finances and believe that cards are an essential part of that equation. READ MORE

In an article titled "Turning to Premium Credit Cards", Alex Mindlin writes for the New York Times how US credit card issuers are focusing their solicitation efforts on premium cards - including the MasterCard World and Visa Signature cards.

The Federal Reserve is out with its latest G.19 Consumer Credit report for July 2009. According to the Fed, US consumer credit decreased at an annual rate of 10-1/2 percent in July 2009. Revolving credit decreased at an annual rate of 8 percent, and nonrevolving credit decreased at an annual rate of 11-3/4 percent.

Driven by a significant decrease in satisfaction with fees and rates, overall credit card customer satisfaction has declined to a three-year low, according to the J.D. Power and Associates 2009 Credit Card Satisfaction Study released today.

"The study finds that overall credit card customer satisfaction decreases to 703 on a 1,000-point scale—the lowest level since the study’s inception in 2007. Overall satisfaction among credit card customers remains the lowest across the financial services industries in which J.D. Power and Associates conducts research, including insurance, banking and investment services." READ MORE

Maria Aspan reports for American Banker this afternoon that Citi Holdings has sold $1.3 billion of managed card portfolios to US Bank. She reports that the portfolios were associated with KeyCorp, Associated Banc-Corp, and the affinity card portfolio for the American Dental Association.

Earlier, Floyd Norris of the New York Times posted a commentary about Citi's earlier press release announcing the sale - calling it the "least informative announcement." He said that "I can’t remember a deal announcement when a company said it had sold undisclosed assets to an undisclosed buyer for an undisclosed price, resulting in an undisclosed profit or loss."