“They will do all the comparisons for you, across all the different providers, and you can organize a list based on: I prioritize Air Miles, I prioritize cash back, I prioritize low interest rates,” Marques said.
“They’ll compare all the providers with best in class in those categories, and show you their current rates, their current signup offers, et cetera.”
As for younger consumers, Marques said low interest rates aren’t typically a priority, assuming you aren’t already managing a lot of credit card debt and you’re not transferring a balance.
Instead, travel rewards and cash back from your favourite retailers are likely the biggest returns on your spending, she said. Options with no annual fees are also valuable for someone just starting out, although there will be fewer rewards.
Can you negotiate with credit card issuers?
When getting a new card, there isn’t much room for negotiation, Terrell said—what you see is what you get. If you want different or better perks, the provider will just point you to another card that offers them.
Negotiations come into play if you already have debt, Marques said, or are transferring debt between cards to take advantage of the lowest rate.
Using signup offers—such as zero interest for the first 12 months—with a balance transfer means you can get a break from interest and pay down your balance faster, she said. Or if you want to keep your current card, you can simply call your provider and move your balance to a lower-interest option.
“There is an opportunity to negotiate their interest rates or even negotiate on your annual fees,” Marques said. “I think a lot of consumers don’t realize that if you just call and ask … in a lot of cases, they will.”
Fresh off an appearance at Coachella, the Diljit Dosanjh Canada tour starts in Vancouver on April 27, 2024 at BC Place—a night that’s expected to be the largest Punjabi show ever produced outside of India. The singer will also be the first ever Punjabi artist to perform at the venue.
With 8.5 million monthly listeners on Spotify alone, and 24 million followers across all his social media platforms, Simplii felt Dosanjh would be the perfect candidate to be its first-ever brand ambassador.
“We both share the same passion for inspiring and supporting new Canadians and helping people live life to the fullest,” said Kam Dhadwar, managing director at CIBC Capital Markets, in a statement. “Nearly a third of Canadian newcomers originate from India and with Diljit’s help, we hope to help them see themselves in the Simplii brand.”
What the Simplii Dosanjh partnership means for Simplii clients
As of yet, this partnership doesn’t seem to offer any special perks for Simplii Financial customers looking to grab tickets to the Dosanjh show in Vancouver. “At the moment, our partnership includes social content, ads, contesting, and advice for our clients,” Dhadwar says in his statement, “but we’ll share more on how the partnership evolves over time.”
What to know about Simplii and its entertainment perks
Simplii Financial is one of Canada’s biggest alt-banks, with over 2 million Canadian account holders. It operates as an online-only institution, although clients can go to ATMs at any CIBC location, thanks to an ongoing partnership. Pitching itself as a bank for newcomer Canadians and international students, Simplii allows account enrollment from over 90 countries, same-day no-transfer-fee transactions to more than 130 countries, and foreign currency savings accounts, including for Indian rupees. It also offers high-interest savings accounts, chequing accounts and other products.
While Simplii is a fairly no-frills banking option, its Simplii Cash Back Visa Card offers a decent 4% reward rate for select restaurants, bars, and coffee shops, although it has an annual cap of $5,000. It also grants 1.5% back on $15,000 worth of eligible gas and pre-authorized payments, and a no-cap, 0.5% back on everything else. This might not do much for a Dosanjh fan looking for exclusive access before the show, but it could help concertgoers save a bit of money on their big night out. MoneySense lists it as one of the best credit cards for newcomers to Canada.
Are entertainment rewards worth it?
Plenty of credit cards and financial institutions and banks in Canada offer entertainment rewards. These range from early access to select shows to cash back rewards on ticket purchases, flights, or other entertainment options like restaurants and bars. For someone spending as much as $2,361 on front-row tickets at Dosanjh’s Vancouver show, according to Ticketmaster, entertainment rewards can go a long way. But not all cards are created equal.
The Simplii Cash Back Visa Card doesn’t offer entertainment rewards for show tickets, although Simplii’s cardholder agreement says it may give special offers from time to time. These could, presumably, include access to tickets to special events. For example, RBC helped Avion Rewards members snag tickets for Taylor Swift’s Eras Tour.
Under Attorney General Merrick Garland, the Department of Justice has signaled that it will take a tougher approach to bank mergers. But the department’s leadership could change in early 2025, at which point the Capital One-Discover deal might still be under review.
Competition — or the lack thereof — will be at the heart of the debate as bank regulators and antitrust officials weigh whether to approve the deal.
Does Capital One’s purchase of Discover create an unstoppable credit card-issuing giant? Does it help consumers by giving Discover’s payments network a fighting chance against massive rivals Visa and Mastercard? Or does it do both? And if so, what should be the verdict?
“The question is: Is this anti-competitive or is it pro-competitive?” said Todd Baker, a professor at Columbia Law School and managing principal at Broadmoor Consulting.
The Biden administration, which has pledged aggressive scrutiny of mergers in the banking and financial sectors, would ideally like not to be approving more big-bank mergers, Baker said. “But this might actually be one which is relatively pro-competitive,” he added.
Monday’s announcement of the proposed $35.3 billion merger immediately drew criticism from Democratic lawmakers.
Sen. Elizabeth Warren, D-Mass., said that the deal “threatens our financial stability, reduces competition, and would increase fees and credit costs for American families.”
“Regulators must block it immediately,” Warren said on X, formerly known as Twitter.
Consumer groups, including the National Community Reinvestment Coalition and Americans for Financial Reform, also came out against the deal, which would combine two of the top six U.S. credit card lenders.
“Today’s concentrated markets and behemoth banking organizations are the result of a thirty-year run of mergers and consolidation,” said Patrick Woodall, senior fellow at the Americans for Financial Reform Education Fund. “It is time for the banking regulators to stop rubber-stamping these transactions and stand up for consumers, communities, and a more stable financial system by blocking this takeover.”
The deal’s approval is not a slam dunk, experts said, nor is its rejection. But they also said there are reasons to think that the Biden administration, notwithstanding its general skepticism of large mergers, might approve this particular deal.
Even if Capital One were to suddenly account for 19% of U.S. credit card loans — as some analysts calculated would be the case if the merger goes through — it would still face strong rivals such as JPMorgan Chase, Citigroup, Bank of America, Wells Fargo and American Express.
But the clearer argument for approval is that, thanks to Capital One’s larger balance sheet and customer base, Discover’s payments network would get the lift it needs to better compete with Visa and Mastercard, which are often described as a “duopoly.”
“Will this introduce more competition into cards or reduce competition in banking?” asked Peter Conti-Brown, a professor at the University of Pennsylvania’s Wharton School. “These are the questions on which the preliminary announcements are light, but that regulatory processes will be focused like lasers.”
Within the Biden administration, bank regulators and the Department of Justice don’t see the risks in a uniform way, Conti-Brown said. Some officials see any concentration as something to fight, while others see bank concentration as serving useful purposes, he said.
During a Tuesday morning conference call, Capital One CEO Richard Fairbank was optimistic about the deal’s chances for regulatory approval. He said he expects the deal to close in late 2024 or early 2025.
The timeline could be crucial. Brian Gardner, chief Washington policy strategist for Stifel, noted that, should Republicans take the presidency after the 2024 election, many of the existing dynamics involving Democratic agency heads could be moot.
“At that point, things have shifted in favor of the industry,” he said.
Fairbank hinted that concerns about the power of Visa and Mastercard could work in Capital One’s favor, saying that the deal would “position us to compete more effectively against some of the largest banks and payment companies in the United States.”
“We believe that we are well positioned for approval,” he said.
The dominance of Visa and Mastercard in card processing has been the target of recent legislation that aims to reduce credit card swipe fees. That bipartisan bill would require larger banks to offer merchants the choice of two unaffiliated card networks that aren’t both Visa and Mastercard.
The legislation has picked up momentum with additional co-sponsors and a potential hearing with the heads of the card networks.
Shahid Naeem, a senior policy analyst at the American Economic Liberties Project, a left-leaning group that criticizes corporate consolidation, argued that regulators should not take Capital One’s pro-competition arguments at face value. He said it will be tough for Discover to “become a threat” to Visa and Mastercard.
Some Capital One customers may not want to ditch their current Visa and Mastercard cards and switch to the Discover network, Naeem noted.
“It’s a tall task,” Naeem said. “When these arguments are being made about, ‘This is how this deal is going to improve competition,’ it’s important to just ask the next question … ‘OK, why?’ ‘OK, how?’ ‘What’s the time frame?’”
Jeremy Kress, a University of Michigan professor who was recently detailed at the Department of Justice to work on bank merger policy, said that he sees “red flags” in terms of the deal’s competitive effects on the credit card market, given that Capital One and Discover are already among the top issuers.
“Antitrust law is not a balancing act,” he said.
The recent rejection of the JetBlue-Spirit Airlines merger by a judge is a good example of why the Capital One-Discover deal should fail, Kress said.
JetBlue had argued that allowing the two airlines to merge would help the buyer to compete better with larger, legacy airlines. But the Department of Justice contended — and the judge agreed — that it’s not enough for a deal to help competition in one customer segment. If another segment will be hurt, the deal should be rejected.
“You could see a similar line of reasoning applying here, even if for the sake of argument, you assume competitive efficiency in the card network business,” Kress said. “If it would be anti-competitive for the card issuance market, then the deal is anti-competitive.”
Bank regulators have also been rethinking how they approach merger applications.
Late last month, acting Comptroller of the Currency Michael Hsu said in a speech that the agency he leads would remove a rule that limits the amount of time it has to consider mergers — a change that could slow the approval of deals, but which some advocacy groups still found to be anemic.
For the proposed Capital One-Discover merger, the bank regulators’ review process will not follow its typical path.
Such reviews typically involve careful consideration of a deal’s impact on bank branches in certain areas — often dealing with concerns about financial deserts — but Discover does not operate branches.
Baker said the deal would create a dominant player in the subprime credit card market, and potentially also in the near-prime market. That’s a factor that might draw regulators’ focus, he said.
“It really becomes a question, almost not of antitrust, but more around industrial policy,” Baker said. “What do we want the banking and payment system to look like in the future?”
“The CFPB will be accelerating its efforts to ensure that consumers can access better rates that can save families billions of dollars per year,” Rohit Chopra, the agency’s director, says in response to its findings that the largest credit card issuers charge much larger APRs than smaller issuers.
Al Drago/Bloomberg
The largest credit card issuers charge significantly higher annual percentage rates than smaller issuers, resulting in some cardholders’ paying as much as $400 to $500 a year extra and the big companies’ earning billions of dollars in additional interest income, the Consumer Financial Protection Bureau said.
The CFPB on Friday released a survey of 84 banks and 72 credit unionsthat found large credit card issuers offered the highest interest rates across all credit scores. The survey comes as the CFPB is expected to finalize a rule soon that would slash credit card late fees to $8, potentially wiping out up to $9 billion a year in profits for banks and credit card issuers.
The survey results also coincide with the CFPB’s narrative under Director Rohit Chopra that the largest banks are charging consumers so-called junk fees primarily to pad their bottom lines. The survey found that small banks and credit unions offer lower interest rates on average across all credit-score tiers than the largest 25 credit card companies.
The median interest rate charged by large credit card companies was 28.2% compared with 18.15% charged by small issuers, to consumers with good credit — typically credit scores between 620 and 719, the CFPB said.
“Our analysis found that the largest credit card companies are charging substantially higher interest rates than smaller banks and credit unions,” Chopra said in a press release.“With over $1 trillion in credit card debt outstanding, the CFPB will be accelerating its efforts to ensure that consumers can access better rates that can save families billions of dollars per year.”
The CFPB found that the APR spread between the top 25 issuers and the smallest ones was between 8 to 10 percentage points, with only a slight variation based on consumers’ credit scores. The survey was based on data collected in the first half of 2023 including data on so-called purchase APRs, which captures the interest rate credit card issuers charge on purchases when a consumer carries a balance.
The CFPB has said that credit card companies’ margins are increasing as they price APRs further above the prime rate, which the bureau has said signals a lack of price competition. Credit card companies are offering more generous rewards and sign-up bonuses to win new accounts, which largely benefits consumers with higher credit scores who pay their balances in full each month.
The CFPB has long sought to explore ways to promote transparency and comparison shopping on purchase APRs — a major cost of credit cards that is often unknown to consumers prior to card issuance.
Lindsey Johnson, president and CEO of the Consumer Bankers Association, issued a strongly worded rebuttal of the CFPB’s statistics and statements, homing in on the bureau’s assertions that the credit card market is not competitive.
“The CFPB’s own data simply does not support their assertions about competition in the credit card marketplace,” said Johnson, noting that nearly 4,000 banks issue more than 640 individual credit card products. “This may be the only time that anyone has pointed to a market with vastly different prices as an indication of competition problems.”
CBA, which represents most large credit card companies and banks, took issue with the CFPB’s description that the credit card market is highly concentrated and “anti-competitive.” She said how interest rates are calculated and whether fees are assessed varies greatly and can depend on product features such as rewards such as cash-back benefits.
“In a world where only one price is offered, consumers lose — even if it’s the ‘lowest-price’ option,” she said. “Rather than bolstering this already highly competitive and well-regulated market, the CFPB seems to be driving consumers to a one-size-fits-all world focused on specific criteria that the CFPB chooses, as opposed to the preferences of the people we should all be working to serve.”
The CFPB’s research found that the top 30 credit card companies represent about 95% of credit card debt, while the top 10 companies dominate the marketplace. The CFPB also listed 15 issuers—including nine of the largest ones in the country — that reported at least one product with a maximum purchase APR over 30%. Many of the high-cost cards are co-branded cards offered through retail partnerships.
The top issuers include JPMorgan Chase, American Express, Citigroup, Capital One Financial, Bank of America, Discover Financial, U.S. Bancorp, Wells Fargo, Barclays and Synchrony Financial.
A few consumer groups and nonprofits aligned glommed on to the CFPB’s report to blast large banks.
“The CFPB’s report is a clear indictment of how big banks, emboldened by unchecked mergers and consolidation, exploit their market dominance to lock consumers in so they can levy exorbitant fees and interest rates,” said Morgan Harper, director of policy and advocacy at the American Economic Liberties Project, a progressive nonprofit group.
The CFPB said it has taken a number of steps to address what it claims are problems in the market including promoting switching through open banking, scrutinizing bait-and-switch tactics on credit card rewards, closing loopholes that allow credit card issuers to extract junk fees, and promoting credit card comparison shopping.
The agency recently updated its credit card data webpage and said it continues to expand its reporting on credit card data.
When it comes to credit cards and the banks that issue them, bigger is most definitely not better — at least for customers.
That’s because small banks and credit unions typically offer far better credit card terms and interest rates than the largest issuers, the Consumer Financial Protection Bureau said in a new report. In fact, the 25 largest card issuers charged customers interest rates that were eight to 10 percentage points higher than the rates on products from smaller lenders and credit unions, according to the federal agency.
Notably, even for consumers with a strong credit score that can amount to hundreds of dollars in additional interest payments per year, the CFPB said. The median interest rate for people with good credit — a score between 620 and 719 — was 28.20% on cards from from large issuers and 18.15% for small issuers, according to the findings.
For the average cardholder with a balance of $5,000 the difference translates to $400 to $500 in additional annual interest.
“Our analysis found that the largest credit card companies are charging substantially higher interest rates than smaller banks and credit unions,” CFPB Director Rohit Chopra said in statement.
The findings are based on an analysis of 643 credit cards from 156 issuers, including 84 banks and 72 credit unions, offered during the first half of 2023.
Credit card issuers tend to promote rewards programs and sign up bonuses, but bury the actual interest rate and penalty fees, Adam Rust, director of financial services at the Consumer Federation of America, told CBS MoneyWatch.
“The advice here is to be proactive about calling local banks and credit unions, rather than just responding to an offer that comes in the mail or through your browser, as those are most likely from the large issuers,” he told CBS MoneyWatch.
The CFPB’s findings are less relevant to the roughly half of consumers who pay off their credit cards every month, noted Ted Rossman, senior industry analyst at consumer financial services company Bankrate. “For those people, interest doesn’t matter. Connected to that, big banks do tend to offer better rewards.”
Mounting financial stress
Large banks don’t only typically charge higher interest rates — they’re also more likely to charge annual fees, the CFPB found. Among large issuers’ credit cards, 27% carried an annual fee, versus 9.5% of small issuers, according to the agency. The yearly fee averaged $157 for the largest issuers, compared with $94 for smaller financial firms.
For Americans, the interest and fees are contributing to what is a growing mountain of debt. Credit card balances stood at $1.13 trillion in the fourth quarter of 2023, up $50 billion, or 4.6%, from the the prior three-month period, according to recent data from the Federal Reserve Bank of New York. More consumers are falling behind on their payments, with 5.4% of credit card debt behind by 90 days or more, up from 4% in the final quarter of 2022.
“Credit card and auto loan transitions into delinquency are still rising above pre-pandemic levels,” Wilbert van der Klaauw, economic research adviser at the New York Fed said in a statement. “This signals increased financial stress, especially among younger and lower-income households.”
Nearly half of credit card users carry a balance from one month to the next, up a full 10 percentage points from 2021, according to Bankrate. Of those who revolve their balances, 58% — 56 million people — have been in debt for at least one year, according to the company.
“We know from our data that it’s about half and half — for every one person getting cash back, or airline miles, unfortunately there is someone else paying a high interest rate,” Rossman said.”A lot of people have credit card debt for very practical reasons. It’s a tough cycle to break.”
The National Foundation for Credit Card Counseling offers nonprofit, certified counseling at nfcc.org, and the Federal Trade Commission offers tip for getting out of debt here. America Saves, a non-profit campaign by the Consumer Federation of America, also offers tips and guidance.
Although the transition will be largely managed internally by RBC, current HSBC customers might have questions about what’s coming up in the next two months. In this article, we’ll walk you through what to expect.
What will happen to HSBC Canada customers?
During the transition, most changes will be automatic, so HSBC customers can continue to bank as they normally would. Customers should look in the mail for a product and services guide, called Welcome to RBC, and keep it around during the transition as it contains reference information and links. Below we’ve outlined what is expected to happen with HSBC accounts, loans and investments.
Personal banking
What’s happening: RBC will identify suitable bank accounts for HSBC customers based on the features of their current accounts and will send new RBC debit cards in the mail. Customers without an HSBC chequing or savings account will receive an RBC client card number. Expect to receive your cards or client card number by the end of February 2024.
What to do: Continue to use your HSBC card until the transition to RBC is complete. In the meantime, use your new RBC card or client number to enroll in RBC online banking or the RBC app. You can activate your debit card online. This will ensure that you have access to your RBC accounts once the transition is complete.
Note: Your historical account information will migrate to RBC but you can also download it from HSBC to have it on hand. For more information, refer to Section 2 of your welcome package.
Credit cards
What’s happening: As with your personal bank accounts, RBC will identify which RBC credit cards to offer you based on the features of your current HSBC credit cards, and the bank will mail them to you by the end of March 2024. Your personal credit limits and balances will be the same as they were with HSBC. Any insurance coverages and services you had through HSBC, however, will come to an end and be replaced with those offered by RBC, if applicable.
What to do: Activate your credit cards online right away, but also carry your HSBC cards until your RBC cards are ready to use. Find out more about credit cards in Section 5 of the welcome guide or by visiting RBC’s website.
Mortgages and other loans
What’s happening: All HSBC lending products, including lines of credit, loans and mortgages will migrate to RBC at the end of March 2024. The terms of your mortgage agreement, including the interest rate, term, payment amount and frequency, amortization, portability and pre-payment privileges will remain the same until your current term ends.
The Federal Reserve announced Wednesday it will leave interest ratesunchanged, setting the stage for rate cuts to come and paving the way for relief from the combination of higher rates and inflation that have hit consumers particularly hard.
Although Fed officials indicated as many as three cuts coming this year, the pace that they trim interest rates is going to be much slower than the pace at which they hiked, according to Greg McBride, chief financial analyst at Bankrate.
“Interest rates took the elevator going up; they are going to take the stairs coming down,” he said.
Inflation has been a persistent problem since the Covid-19 pandemic, when price increases soared to their highest levels since the early 1980s. The Fed responded with a series of interest rate hikes that took its benchmark rate to its highest in more than 22 years.
The federal funds rate, which is set by the U.S. central bank, is the interest rate at which banks borrow and lend to one another overnight. Although that’s not the rate consumers pay, the Fed’s moves still affect the borrowing and savings rates they see every day.
The spike in interest rates caused most consumer borrowing costs to skyrocket, putting many households under pressure.
Below the surface, 60% of households are living paycheck to paycheck.
Greg McBride
chief financial analyst at Bankrate
“Below the surface, 60% of households are living paycheck to paycheck,” McBride said. Even as inflation eases, high prices continue to strain budgets and credit card debt continues to rise, he added.
Now, with rate cuts on the horizon, consumers will see some of their borrowing costs come down as well, although deposit rates will also follow suit.
From credit cards and mortgage rates to auto loans and savings accounts, here’s a look at where those rates could go in the year ahead.
Since most credit cards have a variable rate, there’s a direct connection to the Fed’s benchmark, and because of the central bank’s rate hike cycle, the average credit card rate rose from 16.34% in March 2022 to nearly 21% today — an all-time high.
Going forward, annual percentage rates will start to come down when the Fed cuts rates but even then, they will only ease off extremely high levels. With only a few potential quarter-point cuts on deck, APRs would still be around 20% by the end of 2024, McBride noted.
“The credit card rates are going to mimic what the Fed does,” he said, “and those interest rate decreases are going to be modest.”
Although 15- and 30-year mortgage rates are fixed, and tied to Treasury yields and the economy, anyone shopping for a new home has lost considerable purchasing power, partly because of inflation and the Fed’s policy moves.
But rates are already significantly lower since hitting 8% in October. Now, the average rate for a 30-year, fixed-rate mortgage is 6.9%, up from 4.4% when the Fed started raising rates in March 2022 and 3.27% at the end of 2021, according to Bankrate.
Doug Duncan, chief economist at Fannie Mae, expects mortgage rates will dip below 6%in 2024 but will not return to their pandemic-era lows, which is little consolation for would-be homebuyers.
“We don’t see the affordability problem solved until supply increases substantially, interest rates come down and real incomes rise,” he said. “The combination of those things need to move together over time. It’s not going to be sudden.”
The average rate on a five-year new car loan is now more than 7%, up from 4% when the Fed started raising rates, according to Edmunds. However, rate cuts from the Fed will take some of the edge off the rising cost of financing a car — possibly bringing rates below 7% — helped in part by competition between lenders and more incentives in the market.
“There are some very encouraging signs as we kick off 2024,” said Jessica Caldwell, Edmunds’ head of insights.
“Incentives are slowly coming back as inventory improves,” she said, and “most consumers are looking for low APRs with longer loan terms, so the growth in those loans is helpful to lure consumers who have been sitting out due to adverse financing and pricing conditions.”
While the central bank has no direct influence on deposit rates, the yields tend to be correlated to changes in the target federal funds rate.
As a result, top-yielding online savings account rates have made significant moves and are now paying more than 5% — the most savers have been able to earn in nearly two decades — up from around 1% in 2022, according to Bankrate.
Although those rates have likely maxed out, “it will be another good year for savers even if we do see rates come down,” McBride said. According to his forecast, the highest-yielding offers on the market will still be at 4.45% by year-end.
Now is the time to lock in certificates of deposit, especially maturities longer than one year, he advised. “CD yields have peaked and have begun to pull back so there is no advantage to waiting.”
Currently, one-year CDs are averaging 1.75% but top-yielding CD rates pay over 5%, as good or better than a high-yield savings account.
Gamblers in 28 U.S. states can now make legal sports bets from their mobile phones, which has fed fears that a problem-gambling epidemic is building.
When Rob Minnick needed money to fuel his betting habit, he often found it where a lot of gamblers do. He got a cash advance on a credit card.
Minnick was 18 years old when he started betting, convinced that his extensive knowledge of sports would make him a winner. The New Jersey native moved from daily fantasy sports to traditional sports betting to casino games. Eventually, he’d find himself sitting at an Atlantic City poker table while simultaneously peeking at his cell phone, where an online slot machine was spinning.
In late 2022, Minnick was in recovery from his gambling addiction when he had a relapse, which was fed by cash advances. It started with a sports bet, which led to a visit to Parx Casino in Bensalem, Pennsylvania.
By the time the 12-hour binge ended, it was close to midnight. Minnick had created so much debt that he says he had to work a second job for more than five months — and put all of his earnings into repayment — to dig out of the hole.
“With the credit cards, you know that the cash advance fee is going to be huge,” Minnick said. “And you don’t care. Because you’re convinced that you’re going to win it back.”
Over the last six years, legal gambling has spread like a weed across the United States. In early 2018, before a pivotal U.S. Supreme Court decision, only Nevada allowed sports wagering. Now 37 states, plus the District of Columbia, do. State lawmakers have moved quickly amid fears that standing pat will result in a loss of tax revenue as their residents gamble in neighboring states.
Pro sports leagues — once hostile to gambling due to fears that the integrity of their games could be compromised — have embraced the financial opportunities that gambling offers. A year ago, the first-ever sportsbook inside an NFL stadium opened at FedEx Field in suburban Maryland. And fans watching on TV are now inundated with gambling ads.
The ease of access to legal gambling has also soared, as bettors increasingly place their wagers on mobile apps, which is feeding fears that a problem-gambling epidemic is building. In 28 states, gamblers can make sports wagers from their mobile phones, according to the American Gaming Association.
At least six more states currently allow online casino games. As online gambling’s legal status has changed, so has the stance taken by many U.S. banks. Just a few years ago, the mainstream financial industry wanted nothing to do with online wagering, which generally involved offshore operations of dubious legality.
Today, gambling is a growing source of revenue for banks.
“The opportunities for them are overshadowing the risks and dangers,” said Brianne Doura-Schawohl, a lobbyist who advocates for policy responses to problem gambling.
But judging by the experiences of the United Kingdom, which has a longer history of widespread legal gambling than the United States, banks here may eventually be dragged into the burgeoning debate over how to address problem gambling.
After all, banks provide credit to bettors who have already depleted their savings. Banks are also well positioned to offer ways to make it easier for problem gamblers to protect themselves from their own self-destructive impulses. And banks hold reams of transaction data that can indicate which customers have gambling problems.
Back when legal gambling in the U.S. was happening only in casinos, and bettors needed to use cash, banks had less information about who might have a gambling disorder. That’s changed in the era of online betting.
But what is the proper role for U.S. banks in addressing problem gambling? So far, there has been little public discussion of that question. And there are no easy answers, as Minnick’s experiences illustrate.
“There was always a way to spend more money than I had when I was gambling,” said Minnick, who has been in recovery since his November 2022 relapse. “And that was even without the use of credit cards.”
Of course, specific banks can decide to ban the use of plastic to fund their customers’ gambling accounts. But cash advances offer a simple way around such restrictions, since they don’t trigger a gambling-related merchant category code. Another workaround: using a credit card to purchase a gift card or e-wallet funds.
“I can broadly say that people who are addicted to gambling develop the ability very, very rapidly to get money that they don’t have when they need it,” Minnick said.
There is also the politically charged question of how to balance harm reduction with personal autonomy.
“There’s no clear-cut solution right now that everyone would be happy with,” Minnick said.
Minnick, who will turn 25 in February, now creates content on TikTok, Instagram and YouTube in an effort to help people with gambling problems. He goes by the name Rob Odaat, which is recovery-speak for “one day at a time.” In a recent interview, he was self-reflective about the factors that fueled his addiction.
“I’m responsible for all the things that I did, and I made my life continuously more difficult to live,” he said, before noting that the next stage of his escalating problem — such as his move from sports betting to casino games — was always easy to find in the gambling apps he used.
“They put it one click away,” he said. “And it’s always very obvious where it is on the screen.”
Like others who are trying to help problem gamblers, Minnick sees an analogy between the current moment and the early days of the opioid epidemic, when addicts were often stigmatized.
“I think that over the next eight years, it’s going to go through the full cycle that opioid addiction went through,” he said.
Rob Minnick started placing fantasy sports bets when he was 18 before moving onto traditional sports gambling and then casino games. He now creates social media content warning others about the dangers of gambling addiction under the name Rob Odaat, which is recovery-speak for “one day at a time.”
Kyle Massi
‘Responsible’ vs. ‘safer’ gambling
Gambling in the U.S. is regulated at the state level. And to the extent that state laws deal with addiction, it’s typically by establishing hotlines that gamblers may call if they believe they have a problem. This approach has led to gambling ads that end with narrators rattling off various states’ hotline numbers at breakneck speed.
Gambling operators also offer voluntary tools designed to limit the compulsive behavior of players who recognize they have a problem. For example, the sports betting site FanDuel allows its users to put limits on the amount of money they can deposit in their accounts
during a given period of time. FanDuel users can also cap the size of any wager, as well as the number of hours they can spend on the site each day. Or they can exclude themselves from gambling on FanDuel altogether.
The umbrella term that’s used to describe the dominant U.S. approach to staving off the harms caused by addictive behavior is “responsible gambling.” The basic idea is to provide tools and resources to help bettors manage their time and money while gambling. Gamblers, according to this school of thought, ultimately have responsibility for their own behavior.
Supporters of this philosophy say that it’s in keeping with the American ethos of self-reliance.
“Especially in the U.S., people don’t like to be forced to do anything,” said Joseph Watkins, president of World-Pay Gaming Solutions.
Critics of the responsible gambling approach argue that it’s ineffective. Kasra Ghaharian, a senior research fellow at the University of Nevada, Las Vegas’s International Gaming Institute, said that tools that allow people to block their own participation in gambling have low uptake rates.
“All these tools are great, but no one uses them,” he said.
The United Kingdom, by contrast, is taking a more heavy-handed stance, which is generally known as “safer gambling.”
In a white paper released last April, the U.K. Gambling Commission proposed a system of “financial risk checks” for gamblers who breach certain loss thresholds. The goal is to assess whether the gambler can afford to lose the money that he or she is wagering.
Under the U.K. commission’s proposal, relatively basic checks would be conducted on bettors who record a net loss of 125 pounds in a month or 500 pounds in a year at a particular gambling operator. The operators would conduct the checks, which would look at factors such as court judgments, bankruptcies and the average affluence within the gambler’s postal code.
“These checks should take seconds to process and would be frictionless for the consumer,” the Gambling Commission stated in its white paper, titled “High Stakes: Gambling Reform for the Digital Age.” “We estimate only around 20% of accounts in a calendar year will trigger this check as most never lose this much gambling.”
The commission also proposed more intrusive checks — which would provide more insight into the gambler’s discretionary income — in cases where net losses exceed 1,000 pounds in a rolling 24-hour period. “Such rapid losses are highly unusual and exceed the discretionary income nearly all people likely have available for a day’s activity, so are therefore highly indicative of risk,” the commission stated.
Still to be determined is exactly how these more detailed financial risk checks — also known as affordability checks — would be conducted. The Gambling Commission said that it expects most of the checks could be done by contacting credit reporting agencies, which would provide an estimate of the gambler’s overall disposable income. In some cases, the individual gambler might have to provide information, but the Gambling Commission stated that it might be possible to streamline the process using open banking.
“The Commission is currently working with the financial services sector to explore how more detailed checks would work in practice,” the white paper stated.
Also up in the air, for now, is what exactly U.K. gambling operators would be expected to do with the information they gather. The white paper contemplates a range of possible responses, including applying limits to specific accounts and ending customer relationships in situations that raise serious concerns.
The proposed affordability checks have sparked controversy. Nevin Truesdale, CEO of The Jockey Club, a U.K. horse racing organization, has launched a petition against them. “We believe such checks — which could include assessing whether people are ‘at risk of harm’ based on their postcode or job title — are inappropriate and discriminatory,” Truesdale has argued.
But Lucy Frazer, a Conservative member of Parliament who serves as the U.K. government’s culture secretary, has defended the commission’s proposal. The Gambling Commission estimates that roughly 300,000 people in Great Britain are experiencing problem gambling, and that another 1.8 million individuals are gambling at elevated levels of risk.
All told, those 2.1 million people account for about 3% of the country’s population.
“This government is not in the business of telling people how they can and can’t spend their money,” Frazer wrote in an op-ed late last year. “But we know, for some, gambling leads to a dangerous cycle of addiction that can feel impossible to escape. We have a duty of care to those at the greatest risk of devastating and life-changing financial losses.”
‘The final destination before you’re done’
Not every response to problem gambling in the U.K. relies on government intervention.
For instance, the Premier League, the world’s top professional soccer league, has voluntarily agreed to remove gambling sponsorships from the front of players’ jerseys by the end of the 2025-2026 season, in an effort to reduce gambling’s appeal to kids.
Last April, when the Premier League announced the new policy, eight of the league’s 20 teams had gambling sponsorships on the front of players’ shirts. Numerous U.K. banks, meanwhile, offer features that allow gamblers to block themselves from betting at all, rather than using the self-exclusion features on multiple gambling apps. Those banking-app features, which have yet to gain steam at stateside banks, will typically decline any gambling transactions for three days, providing a cooling-off period to habitual gamblers who want to walk away. HSBC UK is one of the banks that offers such a tool.
“The 72-hour restriction aims to help give our customers time to pause when they are tempted to return to gambling,” Maxine Pritchard, head of financial inclusion and vulnerability at HSBC UK, said in an email.
Across the Atlantic Ocean, some U.S. states have taken a harder line than others on the use of credit cards. Iowa is one of a handful of states that — like the United Kingdom — bans the use of plastic in online sports betting.
“Credit is credit. And gambling has its addiction side,” said state Sen. Tony Bisignano, who was an architect of Iowa’s online sports gambling legislation. “If you mesh the two together, at some point someone will gamble their future away.”
Bisignano, a Democrat, said he believes that Iowa’s ban on the use of credit cards in gambling has saved lives.
“I think credit is the final destination before you’re done,” he said.
Some major U.S. credit card companies are taking a less restrictive stance. A JPMorgan Chase spokesperson said that the bank permits betting transactions where they are legal. Wells Fargo allows its credit cards to be used for lawful purposes, according to a spokesperson.
Bank of America, on the other hand, does not allow credit card transactions with gambling-related merchants, according to a company spokesperson. Citigroup declined to comment.
To advocates concerned about gambling addiction, banning the use of credit cards is a no-brainer. “Playing with money you don’t have can be a red flag,” said Doura-Schawohl, the lobbyist who advocates for policy responses to problem gambling.
Even without putting blanket bans in place, there are steps that credit card issuers could take to protect customers who show signs of having a gambling problem, said Les Bernal, national director of Stop Predatory Gambling, a nonprofit advocacy network.
Bernal would like banks to alert their customers when credit card transaction records indicate that the cardholder is chasing gambling losses, or continuing to place bets in an effort to make up for losing wagers. After all, banks have a unique vantage point that gives them a detailed picture of their customers’ gambling activity.
Those automated messages might work similarly to the fraud protection alerts that cardholders receive when they travel to a different city and make an unexpected purchase. “That was me, I wanted to make that transaction,” Bernal explained.
But the compulsive nature of gambling addiction could limit the effectiveness of this strategy; gambling addicts in the midst of a binge may not be receptive to an intervention from their bank.
Jon-Pierre Micucci, a recovering gambling addict who lives in San Francisco, recalled that he sometimes got phone calls from his bank’s fraud protection department in response to his online gambling sessions. While stuck at home during the COVID-19 pandemic, Micucci fell under the spell of online slot machines operated by unlicensed offshore companies.
“They would offer to hide the transactions like a porn site does. So it would show up as, like, Tommy’s Jeans from Indonesia,” said Micucci, who is now project manager of problem gambling hotlines at Health Resources in Action, a nonprofit consulting organization.
Micucci recalled that his bank statement might have shown roughly 150 consecutive transactions, all in the same odd amount. “All international, all sketchy,” he said.
But when his bank called Micucci to ask about the transactions, he would say: “It’s okay. Those are international. I accept those. And then I was off and running. They would never stop me again.”
Advocates have pushed for banks and others to come up with ways to curb problematic gambling. For instance, sports betting site FanDuel allows users to place limits on their activities, such as a cap on the size of any wager.
Chris Ratcliffe/Bloomberg
‘Bet now/pay later’
The large buy now/pay later firms Klarna and Affirm have not embraced legal gambling. But a nascent product from an upstart competitor specifically targets bettors. Its design has sparked concern that it could feed gambling addictions.
The product, Edge Boost, is being billed as “the first bet now/pay later program for sports bets.” It will allow users to double the size of their wagers, using borrowed funds that they can repay at 0% interest in four weekly installments.
Edge Markets, the company that offers Edge Boost, expects to earn money from interchange fees. It will also charge fees to users who make an early repayment in order to regain access to their full borrowing capacity, according to a promotional video for the product.
“Let’s say you’re feeling great about this weekend’s game, but wish you had an extra $100 to wager,” says the video’s narrator. “Double down, and double your winnings.”
That message, which overlooks the possibility that the gambler will lose the bet, has generated outrage among problem gambling advocates. “This platform glorifies and entices people to spend more than they can afford to lose,” Doura-Schawohl told a sports betting publication last year.
Seni Thomas, the founder and CEO of Edge Markets, said that Edge Boost is in a testing phase, working with Cross River Bank and Galileo Financial Technologies, which is owned by SoFi Technologies. He is looking to launch the product in the first half of 2024, and he said it would be available in 27 states.
A Cross River spokesperson confirmed the New Jersey bank’s involvement. A SoFi spokesperson did not respond to a request for comment.
Thomas has a response to criticism of his company’s product. He argues that Edge Boost will serve as a replacement for illegal gambling, saying that many people bet in the black market because their bookies give them an advance, which is generally not available from regulated companies.
“Bookies want you to lose, and then they start charging interest on the balance,” Thomas said.
He also opined that there’s a misconception that people who gamble are degenerates: “I think people have watched too many movies, frankly.
“These are people that are quite sophisticated,” Thomas added. “They have the cash to back it up — high-income earners.”
It’s true that a majority of gamblers are not addicts.
Last year, researchers at the Center for Gambling Studies at Rutgers University published the results of a phone survey of 3,512 New Jersey residents. Although roughly 61% of the respondents had gambled in the last year, just under 6% of the respondents were classified as “high-risk problem gamblers.” Another 13% of the participants reported low to moderate gambling problems.
Those numbers suggest that a clear majority of gamblers place wagers as a form of entertainment, and they don’t bet more than they can afford to lose.
The Rutgers research also found that the prevalence of high-risk problem gamblers in New Jersey — a state that has a long history of legal casino gambling — was about three times higher than the average rate in a majority of population surveys both domestically and abroad.
Minnick, the gambling addict who has been in recovery since relapsing in November 2022, grew up in Washington Township, New Jersey, less than an hour from Atlantic City. Today he expresses the clear perspective of someone who’s been through recovery. He says that the archetypal gambling addict has an internal desire to accomplish great things, but without putting in a lot of effort.
When he was betting, Minnick once accumulated enough rewards points with Caesars Entertainment to receive a free three-day trip to the Bahamas, where Caesars had a partnership with the Atlantis resort and casino. He was flattered. He felt important.
In the early stages of the trip, Minnick’s wagers weren’t paying off. He decided to place a sports bet, known as a parlay, that would pay out if six different games ended the way he’d predicted.
Minnick correctly forecast the first five legs of the bet. The last contest was a regular-season NBA game between the New York Knicks and the Minnesota Timberwolves.
Minnick had put his money on the Knicks, who held a big lead in the second half. The parlay included a feature that would have allowed Minnick to cash out early for roughly 95% of the value of the win. But he refused to budge. The Timberwolves came back and won the game 102-101.
“I lost the bet, and I spiraled and spent even more money on credit in the casino,” Minnick recalled. “So what started out as feeling like a great gambler, a great big shot, turns into feelings of greed. It turns into feelings of depression.
“But it always came down to this belief that it would be different the next time,” he explained. “I would figure it out, and I’d come out on top. And you just don’t.”
One way that Minnick found the money he needed for gambling was by exploiting the fact that U.S. banks didn’t typically settle transactions over the weekend. It’s a loophole that could be closed if real-time payments gain widespread adoption.
Minnick explained, as a hypothetical example, that he might have had $500 in his bank account on a Friday. He would deposit the $500 into the sportsbook. Then he would wager away all $500. “Most people would say, ‘Okay, I have zero dollars, so I can’t gamble.’ But the bank doesn’t process that transaction until Monday. So between Friday and Monday morning, the bank sees that you have $500 in your account,” Minnick said.
Before the weekend was over, Minnick would move another $500 into his account at the sportsbook. “And the banks don’t catch it until Monday morning,” he explained.
“If you’re addicted to gambling, you’ll say something like, ‘Okay, I’m down $1,000 now, which means I’m going to have a $500 overdraft. So now I need to pull out another $1,000,” Minnick said, adding that gamblers convince themselves that they’ll win enough money to pay back the overdraft fees they’ve incurred. “And you dig yourself such deep holes because the bank catches up on Monday.”
‘It’s about putting as many barriers in place’
Gambling industry insiders argue that the rise of legal online betting in the U.S. has brought significant advantages compared with the status quo prior to April 2018. That’s when the Supreme Court opened the floodgates by striking down a federal law that had barred most states from legalizing sports wagering.
First, people in the gambling industry point out, plenty of Americans were making illegal online bets prior to 2018. Legalization has allowed for regulation and oversight, and it’s enabled states to collect tax revenue. Electronic payments also offer various advantages over the paper currency that long ruled Las Vegas.
One asset of noncash payments is that they generate customer-specific data, which can be used to identify problem gamblers and help bettors set and stick to budgets. And data can be harnessed to provide customers with visual signals — such as green, yellow and red lights — about when it’s safe to gamble.
“We can guide people to a certain behavior without forcing them,” said Omar Sattar, co-founder and CEO of Sightline Payments, which specializes in serving the gambling industry.
Ghaharian, the senior research fellow at UNLV, wrote his doctoral dissertation about how payments transaction data can be used to identify markers of gambling-related harm.
Analyzing gambling payments data from more than 2,200 online casino players, he found three clusters of customers whose behavior indicated they were at potential risk of harm, including a group that had high decline rates even though their deposit amounts were low. “That might be a little bit of a red flag,” Ghaharian said.
Ghaharian recently got access to a new dataset, which he hopes will reveal patterns about how gambling transactions relate to other kinds of payments. One goal of the research is to look at how markers of financial vulnerability — or the ability to withstand a financial shock — relate to gambling spending.
Even some people in the gambling industry say that more needs to be done to address problem gambling. Jonathan Michaels, who consults for gambling firms on payments issues, said there needs to be further collaboration between financial institutions and gambling operators in order to determine when problematic behavior is occurring. “The industry hasn’t taken true proactive approaches,” he said in reference to both banks and gambling companies.
But skeptics wonder whether the gambling industry will ever take aggressive action, given its heavy reliance on frequent gamblers as a source of revenue. The states, which collect taxes from gambling, arguably have a similar conflict of interest.
According to that logic, the financial sector is the one major player that doesn’t have a vested interest in maximizing gambling revenue. Matt Zarb-Cousin, the U.K.-based co-founder of Gamban, which offers gambling blocking software that’s designed to be difficult to remove, described financial institutions as a disinterested third party.
He argued that there is no one silver-bullet solution in the battle against gambling addiction: “It’s about putting as many barriers in place.”
There’s no shortage of recommendations for how banks can contribute. Stop Predatory Gambling suggests not only larger ideas like credit card bans, but also smaller ones. For example, the banking industry could promote one day a year, similar to National No Smoking Day, when Americans are encouraged not to gamble.
Banks could also throw their support behind the idea that all gambling apps and slot machines must have a warning that reads, “The money that I’m gambling is not borrowed, and I can afford to lose it.”
Gambling reform advocates have generated at least two other ideas for how banks could help. One is to communicate with young people and vulnerable populations about problem gambling.
Banks could also take steps to help their customers understand how much they’ve spent each month on wagers. “It isn’t their problem to solve,” Zarb-Cousin said.
“But they are in a very good position to solve it,” he added.
The Federal Reserve is expected to announce it will leave rates unchanged at the end of its two-day meeting this week, after recent reports showed the economy grew at a much more rapid pace than expected and inflation eased.
“In many ways, we already have a soft landing,” said Columbia Business School economics professor Brett House. “The Fed has threaded the needle of the economy very artfully with a kind of ‘Goldilocks‘ scenario.”
Gross domestic product grew at a much faster-than-expected 3.3% pace in the fourth quarter, fueled by a solid job market and strong consumer spending. However, inflation is still above the central bank’s 2% target, and that also opens the door to a “no-landing scenario,” according to Alejandra Grindal, chief economist at Ned Davis Research.
“No landing means above-trend growth, and also above-trend inflation,” Grindal said, describing an economy that is “overheating.”
Inflation has been a persistent problem since the Covid pandemic, when price increases spiked to their highest levels since the early 1980s. The Fed responded with a series of interest rate hikes that took its benchmark rate to its highest in more than 22 years.
As of the latest reading, the current annual inflation rate is 3.4%, still above the 2% target that the central bank considers a healthy annual rate.
The combination of higher rates and inflation have hit consumers particularly hard. A “no landing” scenario also means more strain on household budgets and those with variable-rate debt, such as credit cards.
While still elevated, inflation is continuing to make progress lower, possibly giving the Fed a green light to start cutting interest rates later this year.
“That looks like the soft landing has been more or less achieved and is likely to be sustained,” House said.
For consumers, this means relief from high borrowing costs — particularly for mortgages, credit cards and auto loans — may finally be on the way as long as inflation data continues to cooperate.
“The real danger here is that the Fed loosens prematurely, which is exactly what they did in the late 1960s,” said Mark Higgins, senior vice president for Index Fund Advisors and author of the upcoming book “Investing in U.S. Financial History: Understanding the Past to Forecast the Future.”
“The risks of allowing inflation to persist still far outweighs the risk of triggering a recession,” he said. “Their failure to do this in the late 1960s is one of the major factors that allowed inflation to become entrenched in the 1970s.”
According to Higgins, history suggests there could likely still be a recession before this is over.
To that point, 76% of economists said they believe the chances of a recession in the next 12 months is 50% or less, according to a December survey from the National Association for Business Economics.
“It’s normal for an economy to go through periods of expansion and contractions,” Higgins said. “In the short term it will be painful, in the long term we are better off doing what is necessary to return to price stability.”
Whether you’re planning to cohabitate or you’re already living together and are starting to plan financial goals, here are some tips on bringing your money together.
Talk about money with your partner early
Whether you’re married or not, it’s important to understand your partner’s financial situation, goals and values. Feelings about money formed during childhood often influence us as adults—for instance, fear of not having enough, discomfort with debt, or family taboos around talking about money. Even without these money hang-ups, everyday spending and saving can be stressful when you’re combining finances with another person.
If you and your partner are moving in together, discuss how you’ll split household costs. Will regular expenses like rent or mortgage payments, utilities, home insurance, groceries and internet be shared equally or in proportion to your respective income levels? If either of you has children, will you share daycare and other child-rearing costs?
Once you’ve covered everyday expenses and how to track them, consider how you’ll deal with the unexpected. Will you both contribute to an emergency fund? What about big-ticket surprises like a broken appliance or leaky roof? How will you handle it if one person wants the cheapest solution while the other prefers paying more for quality or prestige?
Then discuss how much to budget for discretionary items like restaurant meals, vacations, recreation and entertainment. Is everything shared, or does each partner get to spend their own “fun money” after financial obligations are covered?
Every couple is different, but for these and other money matters, clear, open and honest communication is vital to avoid conflicts and resentment down the road. Don’t wait until you face major events like buying a home or dealing with one partner’s sudden unemployment to start discussing your finances openly.
Sharing your life—and your debt
Legally, each person remains responsible for their own bank accounts, loans and credit card debt. But if you’re planning a life together, reducing your combined debt creates a stronger financial foundation. Helping your partner pay their debt will also improve their credit score, which may benefit you both in the future, when you need to finance major purchases like a home. Talk about how you’ll manage debt together. Will you help each other pay off existing obligations like credit card balances or student loans?
If you choose to keep debts separate, be aware that if your partner is behind on loan payments, the lender may seek permission to make a claim on jointly held assets—including your home.
Paying your credit card bill in full every month is a worthy goal, but some situations can make it more challenging. Whether you’re planning for a large expense, such as a move or a wedding, or you’ve been hit with medical bills or other emergency expenses, a 0% APR credit card can help you avoid costly credit card debt.
The best 0% APR credit cards offer long introductory APR promotional periods, giving you more than a year to pay down your purchases. Depending on your circumstances, you could ultimately save hundreds of dollars on interest.
That said, it can be overwhelming trying to find the best credit card for you among hundreds of options. To help you narrow down the best options, the Fortune RecommendsTM team evaluated more than 30 0% APR credit cards available today and ranked them based on factors such as introductory period, annual percentage rate (APR), rewards structure, consumer benefits, and more. Read on to see our top picks.
All interest rates, terms, and fees are subject to change.
Best 0% APR credit cards
Best overall 0% APR card (tie): Wells Fargo Reflect Card
The Wells Fargo Reflect® Card gives you nearly two years to pay off your purchases, making it a solid choice if you have significant upcoming expenses, and your monthly budget would make it difficult to pay off the balance sooner.
Key numbers
0% APR Term
21 months
Balance transfer fee
5%
Regular APR
18.24%, 24.74% or 29.99%
Why we like this card : The Wells Fargo Reflect® Card offers an incredibly long 0% APR promotion for both purchases and balance transfers made within the first 120 days from account opening. As a new cardholder, you’ll get a 0% interest rate for 21 months, after which the variable APR is 18.24%, 24.74% or 29.99% based on your creditworthiness. You’ll be hard-pressed to find a card with a longer interest rate promotion.
The card also offers some other valuable benefits, including up to $600 in cell phone insurance, which protects you against damage and theft when you use your card to pay your phone bill. While the card doesn’t offer rewards on your everyday purchases, you can earn cash back with select merchants through the My Wells Fargo Deals program.
Additional perks and benefits: Cell phone protection, My Wells Fargo Deals, roadside dispatch, free FICO score
Best overall 0% APR card (tie): U.S. Bank Visa Platinum Card
The U.S. Bank Visa® Platinum Card is another excellent choice if you’re looking to extend your interest savings for as long as possible.
Key Numbers
0% APR Term
21 months
Balance transfer fee
3%
Regular APR
18.74%-29.74%
Why we like this card: The U.S. Bank Visa® Platinum Card provides an equally long 0% APR promotion as the Wells Fargo Reflect® Card. Once you’re approved, you can enjoy no interest on purchases and balance transfers for 21 billing cycles (which is the same as months). After that, the ongoing variable APR ranges from 18.74% to 29.74%, depending on your creditworthiness.
In exchange for a long introductory APR promotion, the card doesn’t offer rewards, but it does offer some value after the promotional period ends. Most notably, you’ll get up to a $600 reimbursement if your cell phone is stolen or damaged when you pay your monthly cell phone bill with your card.
Pros
Exceptionally long 0% APR period
No annual fee
Cell phone insurance
Cons
Does not earn rewards
No welcome bonus
Foreign transaction fee
Card details
Foreign transaction fee: 3%
Rewards: N/A
Additional perks and benefits: Cell phone protection, Pay over time with a U.S. Bank ExtendPay® Plan
Best for post-intro APR: BankAmericard credit card
If you have great credit and anticipate carrying a balance after the initial 0% APR period, you may be able to get both an introductory 0% APR and a relatively low ongoing interest rate after the promotional period ends with the BankAmericard® credit card.
Key numbers
Intro APR period
18 months
Balance transfer fee
3%
Regular APR
16.24%-26.24%
Why we like this card : With the BankAmericard® credit card, you’ll get a long introductory 0% APR promotion, with no interest for the first 18 billing cycles on purchases, as well as balance transfers made within 60 days of opening your account. After that, your variable APR will be between 16.24% and 26.24% based on your creditworthiness. The card also doesn’t charge a penalty APR.
There aren’t many other notable features, but the card does offer access to your FICO credit score for free. Also, if you have a Bank of America checking account, you can link your card and use it for optional overdraft protection.
Pros
Competitive 0% APR promotional term
No annual fee
No penalty APR
Cons
Does not earn rewards
No welcome bonus
Foreign transaction fee
Card details
Foreign transaction fee: 3%
Rewards: N/A
Additional perks and benefits: Free FICO score, Balance Connect® for overdraft protection
The Chase Freedom Flex℠ is an excellent choice for people who want to combine the value of a 0% introductory APR promotion and a great rewards program. In particular, it’s worth considering if you like the idea of maximizing your cash back on a variety of spending categories.
Key numbers
0% APR term
0% intro purchase APR for 15 months from account opening (after that, the variable APR will be 20.49%–29.24%)
Balance transfer fee
$5 or 3% of the amount of each transfer, whichever is greater, on transfers made within 60 days of account opening. After that: Either $5 or 5% of the amount of each transfer, whichever is greater.
Why we like this card: The Chase Freedom Flex℠ offers a solid introductory 0% APR for the first 15 months on both purchases and balance transfers. After that, a variable APR is 20.49%–29.24% Variable.
As a new cardholder, you’ll also earn a $200 cash bonus after spending $500 on purchases within your first three months
Additionally, you’ll earn cash back on every dollar you spend. Here’s what to expect:
5% cash back on activated bonus category purchases each quarter (up to $1,500 in purchases, then 1 percent)
5% cash back on travel purchased through Chase Ultimate Rewards
3% cash back on dining (including restaurants, takeout and eligible delivery services)
3% cash back on drugstore purchases
1% cash back on all other purchases
5% cash back on Lyft rides (through March 2025)
Pros
Earns up to 5% cash back
Valuable welcome bonus
No annual fee
Cons
Must activate bonus categories every quarter
5% categories are capped
Foreign transaction fee
Card details
Foreign transaction fee: 3% of the amount of each transaction in U.S. dollars
Rewards: 5% cash back on activated bonus category purchases each quarter (up to $1,500 in purchases, then 1 percent), as well as on travel purchased through Chase Ultimate Rewards, 5% cash back on Lyft rides (through March 2025), 3% cash back on dining (including restaurants, takeout and eligible delivery services) and drugstore purchases, 1% cash back on all other purchases.
Additional perks and benefits: Purchase protection, extended warranty protection, trip cancelation/interruption insurance, auto rental collision damage waiver, cell phone protection, complimentary three-month Doordash and Instacart+ membership.
Best for flat-rate cash back: Chase Freedom Unlimited
If you want to earn cash back and prefer a simple rewards structure, the Chase Freedom Unlimited® should be on your radar.
Key numbers
0% APR term
0% intro purchase APR for 15 months from account opening (after that, the variable APR will be 20.49%–29.24%)
Balance transfer fee
0% intro balance transfer APR for 15 months (intro balance transfer fee: $5 or 3% of the amount of each transfer, whichever is greater in the first 60 days)
Why we like this card: The Chase Freedom Unlimited® offers a generous introductory 0% APR on both purchases and balance transfers for the first 15 months. After that, an APR of 20.49%–29.24% Variable applies.
The Chase Freedom Unlimited® doesn’t offer the same 5% cash back on rotating categories as the Freedom Flex®, but it does offer a higher base rewards rate, and all other rewards rates are the same:
5% cash back on travel purchased through Chase Ultimate Rewards
3% cash back on dining (including takeout and eligible delivery service)
3% cash back on drugstore purchases
1.5% cash back on all eligible purchases
5% cash back on Lyft purchases (through March 2025)
In addition to the 0% APR promotion, new cardholders can earn a an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year). Other card perks include consumer and travel protections, such as purchase protection, trip cancellation and interruption insurance and rental car coverage. You’ll also enjoy a complimentary three-month membership to both DoorDash DashPass and Instacart+.
Pros
Sizable welcome bonus
Earns a minimum of 1.5% cash back
No annual fee
Cons
Foreign transaction fee
Other flat-rate rewards cards offer a higher base rate
Card details
Foreign transaction fee: 3% of the amount of each transaction in U.S. dollars
Rewards: 5% cash back on travel purchased through Chase Ultimate Rewards, 5% cash back on Lyft purchases (through March 2025), 3% cash back on dining (including takeout and eligible delivery service), 1.5% cash back on all eligible purchases.
Additional perks and benefits: Purchase protection, extended warranty protection, trip cancellation/interruption insurance, auto rental collision damage waiver, complimentary three-month DashPass and Instacart+ membership
Best for first-year earnings: Discover it Cash Back
The Discover it® Cash Back offers a value proposition similar to the Chase Freedom Flex®, giving cardholders a chance to maximize rewards on several spending categories throughout the year. What’s more, the card’s welcome offer has significant upside potential.
Key numbers
0% APR term
0% introductory APR for 15 months from account opening (after that, the variable APR will be 17.24%–28.24%)
Balance transfer fee
3% of the amount of each transfer for transfers that post to your account by April 10, 2024. After that, 5% of the amount of each transfer.
Why we like this card: The Discover it® Cash Back offers a competitive 0% introductory APR promotion, with no interest for 15 months on purchases and balance transfers. After the promotional period expires, your variable APR will be between 17.24%–28.24%, depending on your creditworthiness.
The card also offers 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. All other purchases will net you 1% back.
What makes the card stand out, however, is its unique welcome offer. Instead of giving you a set cash bonus after you meet a certain spending requirement, Discover will match all the cash back you earn during the first year—and there’s no limit to how much extra cash back you can earn.
As a cardholder, you’ll also get free access to your FICO score, and Discover will help you protect your identity by removing your information from select people-search websites that could sell your data and alerting you when your Social Security number is found on any of thousands of dark web sites.
Pros
Competitive rewards rate
Unique welcome bonus
No annual fee
Cons
Bonus categories are capped
Must register for bonus categories every quarter
Discover is not as widely accepted overseas as other networks
Card details
Foreign transaction fee: None
Rewards: 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate, 1% back on all other purchases
Additional perks and benefits: Free FICO score access, Social Security number alerts, online privacy protection
Best for flexible rewards: Bank of America Customized Cash Rewards Card
The Bank of America® Customized Cash Rewards credit card can be a great choice for people who are looking for more control over how they earn their cash-back rewards. The card allows you to pick your top bonus rewards category from a list of eligible options.
Key numbers
0% APR term
0% intro APR for 15 billing cycles for purchases
Balance transfer fee
0% Intro APR for 15 billing cycles for any BTs made in the first 60 days. A 3% fee applies
Regular APR
18.24%–28.24% variable
Why we like this card: With the Bank of America Customized Cash credit card, you’ll enjoy an introductory 0% APR on purchases and balance transfers for 15 billing cycles, after which the variable APR ranges from 18.24% to 28.24%. You’ll also get an online $200 cash rewards bonus after making at least $1,000 in purchases in the first 90 days.
What makes the card really shine, though, is its customizable rewards. More specifically, you can earn 3% cash back on the category of your choice from the following list of options: gas and EV charging stations; online shopping, including cable, internet, phone plans and streaming; dining; travel; drug stores and pharmacies; or home improvement and furnishings. You can change your category once a month or leave it as is.
Additionally, you’ll receive 2% cash back at grocery stores and wholesale clubs, and 1% cash back on all other purchases. Just keep in mind that your bonus rewards are capped at $2,500 in combined purchases each quarter in the 3% and 2% categories. After that, you’ll earn 1% on all purchases. If you’re a Preferred Rewards member, though, you can earn 25% to 75% more cash back on every purchase.
Pros
Competitive rewards rates
Welcome bonus
No annual fee
Cons
Bonus categories are capped
Foreign transaction fee
Card details
Foreign transaction fee: 3%
Rewards: 3% cash back in the category of your choice from a list of options, 2% cash back at grocery stores and wholesale clubs, 1% cash back on all other purchases. (3% and 2% cash back is earned on the first $2,500 in combined purchases each quarter in the choice category, and at grocery stores and wholesale clubs, then earn unlimited 1% thereafter.)
Additional perks and benefits: Free FICO score, Balance Connect® for overdraft protection
Best for travel rewards: Capital One VentureOne Rewards Card
The Capital One VentureOne Rewards Credit Card may be worth considering if you want to focus your efforts on earning travel rewards and you don’t want a complicated rewards structure.
Key numbers
0% APR term
0% intro APR on purchases for 15 months (after that, the variable APR will be 19.99%–29.99%)
Balance transfer fee
3% of the amount of each transferred balance that posts to your account during the first 15 months that your account is open
Why we like this card: The Capital One VentureOne Rewards Credit Card offers an impressive 0% APR on purchases and balance transfers for 15 months. After that, the APR rises to 19.99%–29.99% variable.
As a new cardholder, you’ll also earn 20,000 miles after spending $500 on purchases within 3 months from account opening Additionally, you’ll earn 5x miles on hotels and rental cars booked through Capital One Travel and 1.25x miles on every other purchase.
When it’s time to redeem your travel rewards, you’ll get maximum flexibility. Options include booking through Capital One Travel and paying with miles, covering travel purchases using your miles or transferring your miles to one of several airline and hotel rewards programs.
The card also offers some other perks, including travel accident insurance, rental car coverage and exclusive access to live events and dining experiences.
Pros
Flexible travel rewards
No annual fee
No foreign transaction fee
Cons
Maximizing travel partners requires a learning curve
Cash redemption value is limited
Card details
Foreign transaction fee: None
Rewards: 5 miles per dollar on hotels and rental cars booked through Capital One Travel and 1.25 miles per dollar on all other purchases.
Additional perks and benefits: Travel accident insurance, rental car coverage, extended warranty protection, exclusive access to events through Capital One Dining and Capital One Entertainment
Either $5 or 3% of the amount of each transfer, whichever is greater
Regular purchase APR
17.99%–28.99% variable
Why we like this card: The Amex EveryDay® Credit Card offers new cardholders a 0% APR promotion on both purchases and balance transfers for 15 months, after which the APR jumps to 17.99%–28.99% variable, depending on creditworthiness. You can also earn 10,000 points if you spend $1,000 in first 3 months (Terms apply).
On an ongoing basis, you’ll earn 2X points per dollar on U.S. supermarket purchases ($6,000 limit on purchases per year, 1% thereafter), 2 points per dollar on eligible travel purchases through AmexTravel.com and 1X points per dollar on all other purchases. What’s more, you can qualify for a 20% bonus when you make 20+ purchases in a billing cycle.
Like the Capital One VentureOne Rewards Credit Card, this one allows you to transfer the Membership Rewards points you earn to various airline and hotel rewards programs, among other redemption options. You’ll also get car rental loss and damage insurance.
Pros
Up to 2X on spending
Unique bonus for frequent usage
No annual fee
Cons
Some rewards are capped
Other cards may provide higher rewards
Foreign transaction fee
Card details
Foreign transaction fee: 2.7%
Rewards: 2X points per dollar on U.S. supermarket purchases ($6,000 limit on purchases per year, 1% thereafter), 2 points per dollar on eligible travel purchases through AmexTravel.com and 1X points per dollar on all other purchases.
Additional perks and benefits: Car rental loss and damage insurance
Normally, credit cards won’t charge interest on your balance as long as you pay it in full every month. If you carry a balance to the next month, you’ll not only be charged interest on the amount you still owe but you’ll also lose your grace period on new purchases until you pay it in full.
For situations where you anticipate carrying a balance on a single large purchase or several smaller ones, a credit card with an introductory 0% APR promotion can help. These promotions typically give a new cardholder between 12 and 21 months after account opening to avoid interest charges on their purchases.
Once the promotional period ends, the card’s regular APR will kick in. If you still have a balance at that point, the standard APR will only apply to the remainder of that unpaid balance. You can contrast this feature to deferred interest offers—common with retail promotional financing offers—which may charge you interest retroactively if you don’t pay off your original purchase in full by the end of the promotional period.
Additionally, many 0% APR credit cards offer no-interest promotions on balance transfers.
How do I qualify for a 0% APR credit card?
For the most part, 0% APR credit cards require good or excellent credit to get approved. According to FICO, that means having a credit score of 670 or above, but each card issuer has its own criteria for determining what qualifies, so meeting that threshold doesn’t guarantee approval.
If you’re thinking about applying for a 0% APR credit card, check your credit score first to get an idea of where you stand and whether you need to make some improvements before you proceed.
Is it possible to lose a 0% APR promotion?
Yes. Zero percent APR offers are typically contingent on your responsible card use. If you miss a payment, for instance, the card issuer may decide to revoke your promotional offer. If this happens, the card’s regular or even penalty APR may apply to your balance until you pay it in full.
When should I use a 0% APR credit card?
A 0% APR credit card can be a great choice if you have an upcoming expense that you can’t avoid and you’re unable to cover the expense with cash or pay off the balance quickly. Some of the most common uses for a 0% APR credit card include:
Emergency expenses
Medical bills
Wedding expenses
Funeral expenses
Home renovations
Holiday purchases
If your card also offers a 0% APR balance transfer promotion, you can use it to consolidate high-interest credit card debt.
That said, it’s important to be mindful of your situation and goals when considering a 0% APR credit card. While it’s not necessary to pay your balance in full by the end of the promotional period—you’ll still get the savings from the interest-free period—it’s best to try to pay off the debt before the regular APR kicks in.
So, try to estimate what your expenses will be, then divide that figure by the number of months in your 0% APR promotion to determine how much to pay each month. For example, if you’re planning on spending $3,000 and you have an 18-month 0% APR promotion, you’d have to pay roughly $167 per month to avoid interest charges.
Frequently Asked Questions
Does a 0% APR promotion hurt your credit?
On its own, using a 0% APR promotion won’t impact your credit score. However, if you rack up a large balance relative to your account’s credit limit, the resulting high credit utilization rate could negatively affect your credit score until you pay it down.
Additionally, applying for and opening a new credit card will also impact the average length of credit history and new credit aspects of your credit score, which can have a temporary negative impact on your score.
What credit card has the longest 0% interest rate?
The Wells Fargo Reflect® Card and the U.S. Bank Visa® Platinum Card both offer no interest for 21 months, giving you plenty of time to pay off even larger balances.
How many 0% interest cards can I get at once?
You can have as many 0% APR credit cards at the same time as you’d like, as long as you can get approved for them. That said, it’s generally not a good idea to open multiple credit cards within a short period of time.
Applying for and opening multiple credit accounts in quick succession can negatively impact your credit score, and it can also be a red flag for lenders who may wonder if you’re having trouble managing your finances without debt.
Additionally, using multiple 0% APR credit cards at once can make it more difficult to keep track of your balances and monthly payments, and possibly also make it more challenging to pay off all of your debt before your promotional periods expire. To make things simpler, consider using just one at a time.
Our methodology
To bring you our top picks for the 0% APR credit cards, the Fortune Recommends team compared more than 30 balance transfer cards available from major issuers.
We ranked each account in these six core categories:
Introductory 0% APR for purchases term (45%): The most heavily weighted factor in our rankings was the length of time that the introductory 0% APR on purchases lasts.
Introductory 0% APR balance transfer term (15%): Since a 0% APR rate on both purchases and balance transfers could help with debt consolidation we also ranked any balance transfer promotional rates.
Post-promotional APR on purchases and balance transfers (10%): To ensure cardholders with an existing balance once the intro period is over aren’t burdened by excessive interest rates, we considered the APR each card charges for balance transfers and purchases after the promo rates end.
Rewards (20%): Cards that also provide rewards (such as cash back or points) on spending were given a boost in our rankings.
Consumer benefits (10%): Cards were awarded 0–5 points based on which consumer benefits/protections were included: purchase protection, extended warranty, cell phone insurance, car rental coverage, and trip cancellation/interruption insurance.
Keep in mind that the interest rates, balance transfer terms, and fee structures for the cards mentioned are available for limited periods and subject to change.
Please note that card details are accurate as of the publish date, but are subject to change at any time at the discretion of the issuer. Please contact the card issuer to verify rates, fees, and benefits before applying.
Terms apply to American Express benefits and offers. Enrollment may be required for select American Express benefits and offers. Visit americanexpress.com to learn more.
Eligibility and Benefit level varies by Card. Terms, Conditions, and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company.
To close a credit card, the balance is $0. If there’s a substantial balance on the remaining cards, it’s going to increase the credit utilization ratio. And, if the increase is high enough, it will hurt your credit score. This is because the closed card’s unused credit limit no longer provides balance in the relationship between your other credit balances and credit limits. What you owe elsewhere can have a bigger impact than if you had a zero-balance credit card.
Another thing: Closing an account means the creditor will stop reporting on your behalf your credit history on that card. If the card showed positive credit history, such as responsible usage and making payments on time, that history will gradually fade away and no longer bolster your credit score.
The reverse can’t be said. If the card showed negative credit history, closing the account will not erase the negative impact on your score.
Generally speaking, cancelling a credit card won’t improve your credit score, and you shouldn’t close a credit card unless you have a good reason, such as not trusting yourself to use the credit responsibly.
Buyer beware: Welcome offers
Many credit cards come with a generous sign-up bonus that helps you earn cash back, points, miles or a reduced interest rate. Welcome offers can be a great way to save money, especially if you already had planned on spending the minimum threshold to earn them. However, proceed with caution.
Read the fine print. Despite the enticing welcome offer of a credit card, your credit score may drop when you apply for a new card as a hard inquiry will be performed during the application process. Although your credit score will only drop a couple of points and will likely recover after a few months if you make your payments on time, it’s still a hit to your credit.
Remember that welcome offers are one-time deals. While some credit card sign-up bonuses may save you money up front, the reality is that any rewards you earn aren’t worth incurring additional bills if you’re already struggling with debt. You should only consider a new welcome offer if you have paid off your credit card debt in full.If you have any debt, focus on paying that down—not short-term wins like getting a lower and very temporary interest rate.
Opening and closing credit cards can impact how you use credit, too. Open multiple new cards, and you may end up with more credit than you can feasibly handle or keep track of. In addition, the allure of welcome offers may distract you from your financial goals. There’s impact on your credit score, and it’s critical to think about how having more or less credit affects your ability to live within your means and pay off your debt in full each month.
Overall portfolio at risk (PAR) for consumer loans in the 31-180 day bucket improved to 3.5 per cent in September 2023 from 4.7 per cent in March 2023. However, PAR for home loans deteriorated to 2.6 per cent from 2.4 per cent, and for credit cards to 8.8 per cent from 8.4 per cent.
PAR for personal loans worsened slightly to 2.4 per cent from 2.5 per cent. As such, origination or sanction quality showed much faster deterioration in early delinquencies, reflected in the increase in 30+ day delinquencies for three-month old loans with a ticket size of up to ₹50,000.
As of September 2023, 8.5 per cent of loans under ₹10,000 and 5.6 per cent of those between ₹10,000-50,000 were in the 30+ DPD (days past due) bucket after three months of sourcing, as per the ‘FinTech Barometer’ report on Personal Loans by CRIF High Mark and Digital Lenders Association of India (DLAI).
The report is based on data from 52 DLAI members submitted to credit bureaus between March 2020 and September 2023.
Top States
Consumer loans grew 64 per cent from March 2020 to September 2023, led short-term personal loans which grew 204 per cent, gold loans (121 per cent), personal loans (115 per cent), credit cards (76 per cent), home loans (53 per cent) and business loans (67 per cent). Maharashtra, Tamil Nadu, Karnataka, Uttar Pradesh and Rajasthan were the top States for consumer lending.
Origination of personal loans increased two-fold in terms of origination value, and 2.6 times in terms of origination volume between FY20 and FY23. However, growth tapered to 32 per cent in FY23 with portfolio outstanding at ₹10.7 lakh crore as of March 2023. DLAI members contributed 7.9 per cent to origination value and 19.8 per cent to origination volume in FY23.
Highest growth in origination value was for loans between ₹10,000-50,000 and those over ₹10 lakh. While loan sanctions of less than ₹1 lakh are still significant for digital lenders, their share has reduced over the past three years, especially for short-term personal loans of less than ₹50,000, the report said.
Demand for short-term personal loans saw a 3.5-fold growth in the beyond top 100 cities compared with 2.3 times growth for the top 100 cities for loans of less than ₹10,000. For the ₹10,000-50,000 loan bucket, the top 100 cities saw three- fold growth as against a five-fold growth for beyond the top 100 cities.
However, given the less saturation in the ‘beyond top 100 cities’, portfolios for these geographies are operating at similar risk levels compared to the top 8 and top 100 cities, the report said.
MoneySense is an award-winning magazine, helping Canadians navigate money matters since 1999. Our editorial team of trained journalists works closely with leading personal finance experts in Canada. To help you find the best financial products, we compare the offerings from over 12 major institutions, including banks, credit unions and card issuers. Learn more about our advertising and trusted partners.
The best Scotiabank cards by category
By Keph Senett on January 22, 2024 Estimated reading time: 4 minutes
Scotiabank offers 17 credit cards tailored to various financial needs and goals. But a handful stand out as the very best the Big Six bank has to offer. Below, we break down our picks for the top Scotiabank credit cards across categories, from travel rewards to cash back and low-interest to perks.
No foreign transaction fees, six free DragonPass lounge visits per year, and more
Best for travel rewards
At a glance: While the bank has a few options when it comes to collecting travel rewards, our top pick is the Scotiabank Gold American Express. The annual fee is well worth it for the card’s earn rate, welcome bonus and perks, including no foreign transaction fees. For those who cross-border shop or travel, the latter is like an automatic 2.5% savings on each purchase in a foreign currency. A suite of travel-related insurance coverage and a discount on Priority Pass membership sweeten the deal.
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Scotiabank Gold American Express
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Annual fee: $120 (waived for the first year)
Earn rates: 6 points per $1 spent on groceries at Sobeys-affiliated stores; 5 points per $1 on dining, entertainment and groceries at other eligible grocery stores; 3 points per $1 on gas, daily transit and select streaming services; 1 point per $1 on everything else
Welcome offer: You can earn up to $650 in value in the first 12 months, including up to 40,000 bonus Scene+ points. Must apply by July 1, 2024.
Annual income requirement: $12,000
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Best for cash back
At a glance: Cash back cards are exactly what they sound like: cards that rebate a percentage of your purchases as cash (usually applied directly to your balance). Our Scotiabank pick in this category is the Scotia Momentum Visa Infinite. This card features an excellent earn rate of 4% back on groceries, recurring bills and subscription services (such as Netflix), 2% back on gas, public transit and ride-sharing services (including Uber), and 1% on all other purchases. Comprehensive travel insurance and concierge service make this an attractive card.
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Scotia Momentum Visa Infinite
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Annual fee: $120 (waived for the first year)
Earn rates: 4% back on groceries, recurring bill payments and subscription services, 2% on gas, public transit, and 1% on everything else
Welcome bonus: earn 10% cash back on all purchases for the first 3 months (up to $2,000 in total purchases). No annual fee in the first year, including on additional cards. Offer ends October 31, 2024.
Annual income requirement: Personal income of $60,000 or household income of $100,000
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Honourable mention
At a glance: Our runner-up in this category is the Scotia Momentum Visa. This card features a solid earn rate of 2% cash back on grocery and drugstore purchases, gas and recurring bill payments—categories that cover the lion’s share of the average Canadian’s spending; all other purchases earn 1%.
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Scotia Momentum Visa Card
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Annual fee: $39
Earn rate: Earn 2% cash back for every $1 spent on groceries, gas, drug stores and recurring bill payments; 1% back on everything else
Welcome bonus: You can earn a 2.99% introductory interest rate with 0% fee on balance transfers for the first 6 months (22.99% after that; annual fee $39). Offer ends October 31, 2024.
Annual income requirement: $12,000
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Best for students
At a glance: Scotiabank’s no-annual-fee Scene+ Visa is a great pick for students who don’t want to pay a fee each year for their credit card. Cardholders collect Scene+ rewards on everyday purchases, which are redeemable for movies at Cineplex cinemas. Scene+ points can also be used for discounts at restaurants—perfect for a study break or night out with friends.
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Scotiabank Scene+ Visa card
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Annual fee: $0
Earn rates: 2 Scene+ points for every $1 spent at Sobeys banner stores and Cineplex; 1 Scene+ point for every $1 spent everywhere else
Welcome offer: You can earn 5,000 bonus Scene+ points within your first year. Must apply by February 29, 2024.
Annual income requirement: $12,000
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Best for low interest
At a glance: At regular credit card interest rates of around 20%, even a small debt can increase quickly. So, if you often carry a balance on your card, consider a low-interest rate option, like the Scotiabank Value Visa. With a low 12.99% interest rate, this card can help you pay down outstanding debt faster.
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Scotiabank Value Visa
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Annual fee: $29 (waived for the first year)
Balance transfer offer: 0% introductory interest rate on balance transfers for the first 10 months. Offer ends 31 October 2024.
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Best for perks
At a glance: For travellers willing to pay an annual fee, the Scotiabank Passport Visa Infinite card delivers. Like the Amex above, this card doesn’t charge foreign transaction fees and includes a robust suite of travel insurance. Cardholders collect points in the Scene+ program at a rate of 3 points per $1 on eligible grocery stores, 2 points per $1 on restaurants and other grocery stores, entertainment and transit, and 1 point per $1 on other eligible purchases. Six free DragonPass airport lounge visits annually is an added benefit for this travel card. Plus, you can use your points to travel on any airline of your choosing.
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Scotiabank Passport Visa Infinite
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Annual fee: $150 (waived for the first year)
Earn rate: 3 Scene+ points per $1 spent at Sobeys stores; 2 points per $1 on groceries, dining, entertainment and transit; 1 point per $1 on everything else. Plus, pay no FX fees
Welcome offer: earn up to $1,300 in value in the first 12 months, including up to 40,000 bonus Scene+ points and first year annual fee waived. Offer ends July 1, 2024.
Annual income requirement: Personal income of $60,000 or household income of $100,000
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Honourable mention
At a glance: The Scotiabank Platinum American Express bundles many rewards and perks into one standout card. As with other Scotia rewards cards, points can be redeemed for merchandise, gift cards or even cash, but it’s the travel rewards that really shine with the Platinum. In addition to the ability to book travel without restrictions, Platinum cardholders can enjoy 10 complimentary visits to airport lounges in the Priority Pass program, as well as membership in the Hertz #1 Club Gold. Cardholders are eligible for premium events through American Express Invites and VIP Pass. Seven types of travel insurance helps members travel safely, and with priceless peace of mind.
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Scotiabank Platinum American Express Card
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Annual fee:$399
Earn rate: 4 points per $1 on gas, groceries, dining and entertainment; 1 point per $1 on everything else
Welcome bonus: You can earn up to $2,100* in value in your first 14 months, including up to 60,000* bonus Scene+ points. Offer ends October 31, 2024.
While rent payments do not traditionally affect your credit, a growing number of so-called rent-reporting services are trying to change that.
These services track users’ rent-paying habits and report them to one or more of the big credit bureaus — Equifax, Experian and TransUnion — with the aim of helping renters build credit and potentially boost their credit score.
But these services don’t all operate the same way, and some may have less value for renters. There’s one major detail you should consider before signing up, said Matt Schulz, chief credit analyst at LendingTree: Is your payment record going to all three bureaus?
“It’s important for people to understand that you don’t just have one credit score,” he said. “You just don’t know which bureau your lender is going to use to get your information.”
This week, real estate site Zillow Group launched a new rent payment reporting feature. Renters who pay through the site can now opt in to have their on-time rent payments reported to Experian, one of the three major credit bureaus, at no charge to the renter or landlord.
In order for a renter to use the Zillow feature, their landlord must be a user of Zillow Rental Manager and have agreed to receive payments through the firm.
“It aligns with our goal of providing accessibility to building credit in the rental space. It’s a really positive step in that direction,” said Michael Sherman, the vice president of rentals at Zillow Group.
While Zillow is the first real estate marketplace to report rental payment data to a credit bureau, it joins a host of different rent-reporting services already available for consumers.
There are many services renters can look into, including some that are free, such as Piñata, and others that come with service or processing transaction fees, such as Rental Kharma, which charges $8.95 a month after an initial set-up fee of $75.
There are also services geared to landlords that offer rent reporting for tenants, including ClearNow, Esusu and PayYourRent. Landlords usually shoulder the cost of these programs, but there may be processing fees depending on how you make your rent payments.
Nearly 50 million Americans have no usable credit scores, according to a 2022 fact sheet from the Office of the Comptroller of the Currency’s Project REACh, or Roundtable for Economic Access and Change.
Being “credit invisible” can affect your ability to qualify for loans and affect the interest rates and terms you are given when you apply for credit.
When rent payments are included in credit reports, consumers see an average increase of nearly 60 points to their credit score, according to a 2021 TransUnion report.
Other payment reporting programs such as Experian Boost, StellarFi and UltraFICO have aims similar to those of rent-reporting services, but with different kinds of payments. They allow users to build credit based on alternative metrics such as banking activity and payments for streaming services, electric bills and mobile phone plans.
Talk to your landlord before you sign up for a rent-reporting service on your own. They may be open to signing up as a benefit to their tenants.
While “people are creatures of habit and don’t always embrace change,” a credit building feature can help a landlord stand out in a competitive rental market, said Schulz.
“It would be significant added value; building credit is a big deal and if you are somebody who can help people build credit, you may be a little more interesting to them,” he added.
Before you sign up to a rent-reporting service, it’s important to understand which bureau or bureaus the company sends reports to. It may not be worth using a service that sends rent payment reports only to a single bureau.
“If a rent-reporting service only gives your information to one of [the three big bureaus], and the lender that you are getting your auto loan from uses a different credit bureau, the benefits that could and should come with that tool may not end up panning out,” said Schulz.
The ideal is that the rent-reporting company gives the data to Equifax, Experian and TransUnion.
“People hear about three credit bureaus, but they don’t understand that your three credit reports are different reports, and different companies report to different bureaus,” said Schulz.
Opinions expressed by Entrepreneur contributors are their own.
When it comes to spending money, cash is no longer king for most shoppers. The majority of consumers prefer using a debit or credit card to make their purchases. This means that being able to accept these forms of payment is critical for businesses today.
This guide will walk you through how to choose the best credit card processor from the many options available on the market, including information on costs, processor types, and what factors you should consider.
What is credit card processing?
When a customer makes a purchase with a debit or credit card, the processor acts as the go-between for the customer’s bank account and the merchant’s bank account. Although the process takes only a few moments, it involves a complex sequence of steps for the credit card processor, the customer and merchant’s respective banks, and the credit card network. The credit card processor’s role includes security verification, routing the transaction and acting as a clearinghouse for funds.
Who needs credit card processing?
Given that the majority of consumer purchases are made with debit and credit cards (and an ever-shrinking percentage made with cash), the vast majority of small businesses must provide a way for customers to pay with cards. Most credit card processors provide several methods for accepting payments. Consider these examples of credit card usage in action:
A brick-and-mortar convenience store must use a full-service register to accept credit card payments via swipe, chip, or tap.
Restaurant servers can use a handheld point-of-sale (POS) terminal to instantly accept card payments right at the customer’s table.
E-commerce stores need the ability to accept credit card information via an online form and checkout technology.
A restaurant that takes orders over the phone needs a virtual terminal to enter credit card payment details manually.
Small-business owners at venues, such as craft markets or trade shows, can use a card reader paired with a mobile device to accept payments while on the go.
How much does credit card processing cost?
It’s important to understand the differences in pricing between credit card processing and other types of business services. The majority of credit card processors employ either interchange-plus pricing or flat-rate processing or a combination of both.
Interchange-plus pricing is when the credit card processor takes a small percentage of each sale, along with a modest fixed fee. The transaction percentage can vary, ranging from approximately 0.29% to more than 3.5%. The fixed fee may be as minimal as a few cents or escalate to 25 cents or more. For some businesses, this fee structure is advantageous because there are no upfront costs. However, it may be less workable for low-margin businesses.
Meanwhile, flat-rate pricing entails paying a fixed monthly subscription fee for unlimited credit card transactions. While this model eliminates concerns about the credit card processor cutting into revenue, it may pose a financial challenge for fledgling businesses due to high monthly fees. Flat-rate prices typically range from $59 to $199 monthly and are often accompanied by high fixed fees on a per-transaction basis.
Additionally, some credit card processors impose incidental and recurring charges, such as Payment Card Industry (PCI) compliance fees, payment gateway fees, network fees, monthly minimum fees and statement fees. Business owners are strongly advised to review the terms of service carefully before committing to any processor.
Furthermore, it’s important to note that specialized POS hardware is required to accept credit cards through swipe, tap or chip methods. While some credit card processors offer free hardware, this path usually involves entering into a contractual agreement. Note also that certain processors provide proprietary POS equipment for purchase while others rely on third-party vendors for their equipment.
What are the benefits of credit card processing?
The main benefit of accepting credit cards is the massive positive effect on sales. The majority of purchases are made with cards and consumers are increasingly going cashless. For businesses that operate primarily online, the ability to accept credit cards is an absolute necessity. Besides the obvious, credit card processing offers many other benefits:
Increased safety: Many businesses have done away with cash payments entirely and only accept payments by card. This helps protect customers and employees by removing the incentive for criminals to target the business during a robbery.
More efficiency: A busy small business, such as a restaurant, can process more sales without worrying about cash payments and making change.
Better data management: Most credit card processors include software that collects and organizes your transaction data. You can gain insight into your business by generating digestible reports and summaries of your sales data.
Streamlined accounting: Some credit card processors integrate directly with popular accounting software programs, such as QuickBooks and Xero, allowing you to import data easily.
Take payments anywhere: With credit card processing, you can accept payments remotely via emailed links, quick response (QR) codes, hosted web pages, and more.
What are the different types of credit card processing equipment?
To accept credit cards, you will need a device or program for inputting credit card information at the POS. Both physical devices and digital solutions are available:
Mobile reader: These devices pair with a smartphone so that you can accept payments while on the go.
Handheld terminal: Often used in restaurants, handheld terminals are self-contained devices that often print receipts.
Register: These fixed POS devices are found at the checkout or behind a restaurant counter. Typically, these are the most expensive options for business owners but they also pack the most features.
Virtual terminal: With a virtual terminal, you can enter credit card information manually into a credit card processing app.
Online checkout: E-commerce customers use checkout forms to enter credit card information for online purchases.
What are the key features to look for in credit card processing?
Whatever processor you choose should have a few key features. Card acceptance, security, hardware options, and basic POS tools are a few features that you should look for during your search.
Accepts all brands.
Make sure that the credit card processor works with all major card brands, including Discover and American Express. This ensures that you don’t lose out on sales and frustrate customers.
PCI compliance.
The credit card processor should comply fully with the PCI Data Security Standard, which will help you maintain PCI compliance.
EMV compliance.
EMV-compliant card readers reduce your vulnerability to fraud and help shield your business from liability in the event of a security breach.
Most credit card processors include basic POS software. If you don’t plan to purchase a separate POS system, then you should look carefully at which features are included as part of the processor’s software.
What factors should you consider when choosing a credit card processor?
In addition to the criteria above, when choosing a credit card processor you should consider several other important factors, such as pricing, ease of use, third-party integrations, customer service and features, such as a mobile app.
Pricing.
Estimate how much your business generates in monthly revenue and use that figure to evaluate which pricing model makes the most financial sense. Whether you choose a processor that follows the interchange-plus pricing model or a flat-rate model will depend on your profit margins and sales volume.
Ease of use.
The best credit card processors sport sleek, modern user interfaces (UIs) that are easy to learn and navigate. If you accept payments in person, make sure that the POS hardware is user-friendly. The best equipment is plug-and-play and ready to accept credit cards immediately. On the e-commerce side, ensure that the processor’s software is compatible with your existing technology stack for easy integration.
Third-party integrations.
Some credit card processing software programs integrate with accounting, POS, human resources and other business productivity software. Make a list of apps that you use for your business and check for compatibility. A few processors also feature open application programming interfaces so that you can build custom solutions.
Customer service.
Credit card processors vary widely in terms of customer service. While some stand out on user review sites for providing top-notch technical support, others score poorly. The standouts in customer service often provide 24/7 phone support and a dedicated account manager. Other options include live chat and email support. If being able to reach the company at any time is important to you, make sure that the customer support options reflect that.
Additional features.
Many credit card processors specialize in servicing a particular type of business. Some focus on providing tools for retailers or restaurants while others are more geared toward e-commerce businesses. Business owners who like to work on the go should ensure that the processor provides a dedicated mobile app. When reading about a credit card processor’s features, think about what your business needs.
What are the top credit card processor vendors?
Clover
Clover provides a variety of pricing plans for different business types, particularly restaurants, retailers and appointment-based businesses. The company is best known for its range of POS hardware, including mobile readers, handheld terminals, and registers. Clover’s POS software integrates with more than 500 third-party apps.
Merchant One
Merchant One customizes plans for individual business needs and offers highly rated customer service. With a low monthly subscription fee of $6.95 and integration with more than 175 online shopping carts, it provides cost-effective solutions.
ProMerchant
ProMerchant offers fair deals for businesses that would otherwise struggle to secure credit card processing services. The company stands out with excellent customer support, including a dedicated account representative. ProMerchant’s willingness to work with any business type, including those with low credit scores, makes it an excellent choice for high-risk businesses.
Stax
Stax offers a subscription-based model without taking a percentage of revenue, which makes it particularly well-suited for high-volume businesses. With compatibility across various POS hardware options and a mobile app for on-the-go transactions, Stax also provides a great deal of flexibility.
Payment Depot
Payment Depot’s membership-based model is perfect for a business that wants to avoid high processing rates. With prices ranging from $59 to $99 a month, Payment Depot doesn’t take a cut of your business’s sales. The company collaborates with SwipeSimple for its software needs and is compatible with many third-party POS device makers.
Chase
As one of the nation’s largest banks, Chase leverages its massive treasure trove of credit card data to provide insights for business owners. With Chase, you can better target customers with data on demographics, purchase habits, and more. Chase also includes fast payouts, synchronization with financial services and Health Insurance Portability and Accountability Act-compliant payment solutions for healthcare businesses.
Helcim
Helcim’s all-inclusive platform includes an intuitive UI, diverse payment options and no contracts or monthly fees. It integrates with third-party devices, allowing flexibility as businesses expand.
PayPal
The PayPal brand name is widely recognized and trusted, offering plug-and-play solutions for online transactions. With various ways for customers to send money and integration with popular business apps, PayPal greatly simplifies online payment processes.
Earn rate: 4% cash back on eligible gas and grocery purchases; 2% cash back on everything else
Welcome offer: You can earn a $40 statement credit for each monthly billing period in which you spend $750 in purchases on your card.
Annual income requirement: None
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6 things to know about the SimplyCash Preferred Card from American Express
1. The base earn rate
Most cash back credit cards offer boosted earn rates in one or two spending categories and only 0.5% or 1% back on everything else. The SimplyCash Preferred Card from American Express offers an excellent earn rate of 4% cash back on gas and groceries (on your first $30,000 in purchases annually) and an impressive base rate of 2% on every other dollar spent, regardless of the spending category. This means cardholders get double or quadruple the return on spending on a host of everyday purchases (like clothes, electronics, and more) when compared to other cash back cards.
2. The welcome offer
New cardholders can earn a $40 statement credit for each monthly billing period in which you spend $750 in purchases on your card.
3. Free supplementary cards
You can add up to nine additional users (aged 13 or older) for no extra fee—an effective, no-cost way to harness other household members’ spends to boost your cash back—which helps make up for the fact that the welcome bonus doesn’t include a first-year fee waiver. In comparison, some premium cards charge an extra annual fee of $29 or $50 for every authorized user you add. The benefit of free authorized users don’t come at the expense of perks or benefits, either.
4. The side perks
SimplyCash Preferred comes with some American Express benefits, including American Express Experiences, such as Front of The Line, which lets you access pre-sale tickets to major live events like concerts and plays. Through Amex Offers, you can get exclusive discounts on certain purchases. Refer friends and family to sign up for the card and earn $50 for each one who’s approved, up to $750 per calendar year.
5. Travel insurance
Travel insurance is a hot benefit for many credit card shoppers, but not all policies are created equal. The good news here is that the SimplyCash Preferred comes with a package that rivals the insurance offerings of most full-fledged travel credit cards. The SimplyCash Preferred covers your for up to $5 million in travel emergency medical insurance for 15 days (for cardholders under the age of 65), up to $500 in lost or delayed baggage insurance, car rental theft and damage insurance for vehicles up to MSRP of $85K (a full $20,000 more than most cards offer), and hotel motel burglary insurance.
6. American Express acceptance
American Express is accepted at tens of thousands of locations across Canada, including most major retail chains and dining establishments. It is important to note, though, that American Express is not as widely accepted as Visa or Mastercard. In addition to not being accepted at some mom-and-pop stores, American Express can’t be used at retailers under the Loblaws banner (except for Shoppers Drug Mart) or at Costco.
Are there any drawbacks to the American Express SimplyCash Preferred Card?
As mentioned above, American Express isn’t as widely accepted as Visa or Mastercard, but you can cover your bases by carrying a second no-fee credit card as a backup. Another downside is that your rewards are only redeemed once annually, in September. Many other cards give you greater flexibility by allowing you to redeem when you want. For example, with the CIBC Dividend Visa Infinite, you can redeem your cash back at any time, as you as you have banked $25 in rewards.
Bottom line
When it comes to cash back cards, the earn rate is arguably the most important metric to consider—and, with a 2% base rate and a 4% bonus rate on gas and groceries, the SimplyCash Preferred card easily climbs the ranks as one the best cash back credit cards in Canada.
Interac e-Transfer is generally a safe way to send money in Canada. In fact, “for every $100 spent across the Interac Debit and e-Transfer networks, less than $0.02 was lost to fraud [in 2021],” according to Interac.
Regardless, fraud happens. E-Transfer fraudsters generally use text or email channels to exploit victims. Some examples of fraud in Canada include:
Tax refund or government relief scams A fraudulent “deposit” of an income tax refund or government financial support is sent to access banking information.
Lottery scams The fraudster requests the provision of sensitive information or a prepayment of an administration fee.
Rental scams Someone pretends to be collecting rent on behalf of your landlord or offers a nice apartment for rent at a low price and requests a deposit to secure it.
Fraudulent sales Typically through an online marketplace, someone may request prepayment for a hard-to-find or rare item and then never send it to the buyer.
Relationship scams Someone impersonates a family member, coworker or romantic interest and asks for money for an emergency.
Work from home ads An applicant is asked to prepay for supplies, training or some other work-related expense for a fake job.
Hacking an email account Scammers find emails containing security questions and answers, and then intercept Interac e-Transfers and deposit the funds to their own accounts.
If the fraudsters were able to send transfers directly from your account, William, it sounds like they were able to hack into your online banking. This may have been from a phishing text, email or website that tricked you into entering your bank login details and allowed the fraudsters to access your account afterwards.
Contact your financial institutions Put flags on all of your accounts, even at other financial institutions. You should change your passwords.
Contact the police Report the incident to the police and update them on any further developments.
Report the incident Contact Canada’s two credit bureaus: TransUnion and Equifax. You can consider credit monitoring that reports suspicious credit activity to you. You should also contact the CAFC by phone at 1-888-495-8501 or using its online Fraud Reporting System.
What do banks consider unauthorized transactions?
It sounds like you have done all the right things so far, William. As far as the bank’s responsibility, each financial institution may have different definitions of what constitutes an unauthorized transaction. You have to check your debit card or credit card agreements to see the terms, which could include restrictions on how long after the transaction occurred that the financial institution will take responsibility. That may be where you are running into trouble.
You could speak with a bank fraud litigation lawyer to see if they can help. An initial consult might confirm whether you have a case or if there are further steps you can take.
Although Americans helped stave off a recession in 2023 by spending enough to propel economic growth, it has come at a cost: Nearly half of consumers say they are carrying credit card debt, according to a new survey from Bankrate.
The personal finance firm found that 49% of credit card users carry a balance from one month to the next. That’s up a full 10 percentage points from 2021. Of those who revolve their balances, 58% — 56 million people — have been in debt for at least one year, according to Bankrate.
The vast number of Americans racking up credit card debt isn’t a sign of reckless spending. The most common reason for not paying off their plastic every month is facing emergency or unexpected expenses, such as medical bills and car repairs, respondents told Bankrate, while many people also use their charge cards to handle daily expenses.
Overall, Americans owe more than $1 trillion on their credit cards — the first time consumers have surpassed that combined level of debt, according to the St. Louis Federal Reserve Bank. That debt has piled up as credit card rates have jumped and inflation continues to sap households’ purchasing power.
The average credit card annual percentage rate hit a record 20.74% in 2023, up 4.44 percentage points from early 2022, according to Bankrate.
“Inflation is making an existing trend worse,” Bankrate senior industry analyst Ted Rossman told CBS MoneyWatch. “We’ve been seeing this for a while, with more people carrying more debt for longer periods of time. It’s moving in the wrong direction.”
Bankrate based its findings on a November survey of 2,350 adults, including nearly 1,800 credit cardholders and 873 who carry a balance on their accounts.
Tips for paying off credit card debt
Rossman offered a few steps consumers can take to start tackling their credit card debt . His top tip? Open a 0% interest balance transfer card that offers a grace period of 21 months during which no new interest is charged.
“It gives you a valuable runway to really make progress without interest weighing you down,” he said.
It’s also worth seeking advice from a non-profit credit counselor or reaching out directly to your credit issuer to seek more favorable terms, such as more forgiving payment due dates or a pause on repaying. “Sometimes they are willing to make accommodations, so it doesn’t hurt to ask,” Rossman added.
Lastly, taking on a side hustle, selling belongings you don’t need, or otherwise trimming your budget can free up dollars to allocate toward paying down high-interest credit card debt.
“Credit card debt is the highest by a wide margin, so it has to be at the top of the list for debt payoff efforts,” Rossman said.
Megan Cerullo is a New York-based reporter for CBS MoneyWatch covering small business, workplace, health care, consumer spending and personal finance topics. She regularly appears on CBS News streaming to discuss her reporting.
